The US exects to announce next week the final batch of steel products that it will be exempt from tariffs of as much as 30 per cent, setting the stage for decisions by the European Union and Japan on whether to retaliate against the duties.
The EU has drawn up plans for immediate sanctions to the value of as much as €379 million on US exports if the so-called safeguards tariffs remain in place. Japan has threatened sanctions to the value of $5 (€5 million) million on US steel products.
The EU had planned to decide on the proposed sanctions last month but deferred action until September 30th, saying it wanted to give Washington time to make more concessions.
President Bush has set August 31st as the deadline for announcing the full list of exemptions. However, a US commerce department spokeswoman said the announcement was now likely to be made next week.
She was speaking after Washington announced a further round of exemptions, the sixth so far, covering 37 categories of steel products, accounting for 543,000 tonnes of annual imports.
This takes the total of imports excluded to more than 1 million tonnes, or 8 per cent of the 13.1 million tonnes affected by the tariffs imposed in March.
Most of the latest exemptions were for 500,000 tonnes of semi-processed slab steel. Lawyers for the US steel industry said about half was accounted for by imports from Brazil, although the commerce department could not confirm this.
Most other exemptions were for products not made in the US or for specialist items for which there was limited demand.
The EU has allowed itself until October to decide whether to impose sanctions on the US.
Brussels says an untested provision of World Trade Organisation rules permits immediate retaliation, because the US imposed safeguards in the absence of an "absolute increase" in steel imports.
The European Commission said yesterday it expected WTO arbitrators to announce this week the size of the retaliation the EU may impose on the US in a separate dispute over a US corporate tax break. Brussels wants the right to impose sanctions of almost $4 billion, but Washington says they should be no more than $1 billion.
Even the lower amount would be the largest authorised so far by the WTO. - (Financial Times Service)
