EU vows retaliation over steel
The European Union and other steel exporters react angrily to a US decision to impose stiff tariffs on imports, raising the prospect of a trade war.
There has been angry international reaction to US President George W Bush's decision to impose punishing tariffs on steel imports. President George Bush was responding to pressure from the US steel industry, which is struggling to compete with cheaper products from abroad. The European Union said the decision broke international trade rules, and promised to launch an immediate complaint with the World Trade Organisation
EU Trade Commissioner Pascal Lamy said it would take whatever measures were necessary to protect its own industry. BBC Brussels correspondent Chris Morris says that raises the prospect of direct retaliation by the EU imposing its own tariffs on American steel. Mr Bush defended the move, saying it would allow US industry to compete on a "level playing field" and recover from the damage he said had been caused by "50 years of foreign government intervention in the global steel market".
A host of other countries have expressing their worries over the US decision, including Japan, Brazil, Australia and South Korea. '
Painful process'
We recognise the US steel industry has to restructure, but we do not believe it is in the interests of the world economy that it should impose tariffs," the spokesman said. "We have gone through the painful process of restructuring in this country, unfortunately the United States has not yet done that." The US ambassador in Moscow was summoned to the Russian Foreign Ministry to be told that relations could be damaged if the tariffs were imposed
Tony Blair has written to
Mr Bush and spoken to
him on the phone
Russian Prime Minister Mikhail Kasyanov said the tariffs would have a "negative impact on Russia's steel industry" but said the move would not spark a trade war. A senior Brazilian trade negotiator Jose Alfredo Graca Lima also criticised the move. "We have been an indiscriminate and unfair victim of the United States," he said. And Japanese Trade Minister, Takeo Hiranuma, said they regretted that the decision had been made "without listening to the voices of its trade partners.
" Short term measures?
The duties, ranging from 8 percent to 30%, will take effect on 20 March and affect 10 separate steel products. It can be amended by the White House if the steel industry's financial crisis worsens or improves.
Mr Bush urged US steel companies to take advantage of the "temporary safeguards" and restructure their industry. The decision was described by advisers and law-makers as a compromise approach, designed to protect US industry while minimising criticism from abroad - and from American manufacturers that rely on cheap steel. Several trading partners, including Canada and Mexico, are exempted.
Job losses
Thousands of US workers have lost their jobs as a result of numerous US steel firms going bust over the last few years. They argue that, without the protectionist measures, the whole US steel industry could become obsolete.
President Bush: Compromised
between two industries
But European steel-makers, including Britain's Corus, fear that US tariffs could limit access for their product in the lucrative American market as well as diverting exports from other countries to Europe, harming local industry.
Details of the tariffs:
Carbon and alloy fitting and flanges, used in car production, 13%