US steel tariffs are illegal

UK Steel today welcomed the preliminary ruling by a World Trade Organisation (WTO) disputes panel that the tariffs imposed by the USA last year on steel imports contravene WTO rules.

UK Steel, formerly the UK Steel Association, today welcomed the preliminary ruling by a World Trade Organisation (WTO) disputes panel that the tariffs imposed by the USA last year on steel imports contravene WTO rules.

Ian Rodgers, Deputy Director commented: ‘This confirms what we said from the start – that there was no legal justification for the US government to impose these measures at a time when steel imports had been falling consistently for three years. The WTO rules are quite clear – such measures can only be taken in response to a current increase in imports.’

Responding to the possibility that the US government might appeal the ruling, Rodgers said ‘this was such a cut-and-dried case from the start, it would make most sense for the US government to end the tariffs immediately, rather than suffer the humiliation of a second defeat.

‘In any case, it debatable whether the US steel industry has had much benefit from the measures, as the main impact has been to allow NAFTA producers and developing countries to fill the gaps left by the exclusion of traditional suppliers such as the EU. At the same time, US consumers have had to pay more for specific types of steel that are only available in sufficient quantities from those traditional sources,’ he said.

‘At the very least, the US government should now take advantage of the mid-term review of the measures – due to be completed in September – by terminating them at that point as a face-saving measure,’ he concluded.

Not everyone was happy, though.

Testifying before Congress yesterday, United Steelworkers of America President Leo Gerard put forth his case for keeping the tariffs in place by declaring, ‘Too many steelworkers and too many of our retirees have already paid too high a price to solve a steel crisis created abroad and ignored for too long by our own government.’

The USWA president cited what he called ‘the consequences of the assault since 1998 on American steel’, listing 37 companies forced into bankruptcy, 54,000 steelworkers who have lost their jobs, and government takeover of pension plans for 14 steel companies involving 240,000 participants and nearly $7 billion in unfunded pension benefits.