Steel Tariffs to End
President Bush announced on 4 December that tariffs on imported steel that were imposed 21 months ago would be repealed. Several nations had brought suit against the tariffs in the World Trade Organization, and the WTO ruled against the US, opening the door for retaliatory tariffs. The European Union, in particular, reacted to the WTO decision by preparing a list of $2.2 billion in proposed tit-for-tat tariffs on US goods and services for export to the EU.
The Administration had imposed the steel tariffs after a finding by the US International Trade Commission that foreign steel was flooding the US market due to the global overcapacity in steel. The President reserved the right to reimpose the tariffs should the ITC find similar surges in the future. However, the decision to impose the tariffs was controversial. US steel producers said they needed time that the tariffs would provide in order to restructure their industry, and to some extent they did so. But importers, and domestic manufacturers using foreign steel as an input to their finished products, were highly vocal opponents of the tariffs.
The tariffs also tended to weaken the American case for lower tariffs and trade barriers in international trade agreements, including the worldwide “Doha Round” of trade agreement negotiations that is now underway.