US lifts safeguard measures on steel imports

The US has removed safeguard measures on steel imports twenty months after they were first put in place. The US Trade Representative says this decision has nothing to do with retaliation threats or electoral politics.

On 4 December, US President George W Bush announced the removal of safeguard measures (tariffs up to 30 per cent) imposed on imports of certain steel products.

EU Trade CommissionerPascal Lamyhas said that in response the EU would remove its own safeguard measures adopted in March 2002 to prevent a flood of steel imports as a result of the US safeguards.

The US safeguard measure (which entered into effect on 20 March 2002) was challenged in the World Trade Organisation (WTO) by the EU and seven other countries, including Japan, Switzerland, New Zealand and Brazil.

The US decision to remove steel tariffs came a few days before the EU were to impose billions of euros worth of retaliatory tariffs on the US targeting imports considered crucial in the 2004 Presidential campaign. These retaliatory measures had been authorised by the WTO's dispute settlement panel and upheld by its appellate body.

US Trade RepresentativeRobert Zoellickmaintained that President Bush had based his decision to remove the 20-month long safeguard measure on the improved state of the US steel industry and not on retaliation threats or election politics.

Maja Wessels, President ofAmCham EU: "The EU and the US should adopt a different approach in order to settle their future differences without igniting any trade wars. Both the EU and the US should move beyond legalistic approaches and work together to find constructive solutions to their disputes. A disproportionate use of litigation creates backlashes - negotiated solutions are a much better option and allow each country to focus efforts on ensuring that their economies stimulate growth."


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