Trade law: EU and US develop new row over steel imports from Asia.

The EU and the United States initially fell out over steel imports in early November during the talks at Transatlantic Business Dialogue. The Americans warned that they were importing ten times more hot-rolled steel from Japan than Europe and that it was impossible for them to sustain these rates. They feared they were becoming a dumping ground for troubled economies, most notably in Asia. US Commerce Secretary, William Daley, insisted that Europe needed to open its doors wider or risk a return to the politics of protectionism.

In response the Commission observed that it was not only carrying a disproportionately high share of the effects of Asia’s economic crisis, but it was also providing $21.7 billion for the IMF support programmes, 18.8% of the total compared to 15.6% provided by the USA. In sectors such as steel the Commission pointed out that imports had risen by 3.2 million tonnes, 56%, in the first five months of 1998, in comparison with a 2 million tonnes, 12.3% increase in the USA.

The Commission also presented figures showing that the EU’s trade balance with South Korea had deteriorated by 54% in the first seven months of 1998 (imports up 13%, exports down 41%), in comparison with 44% for the USA with South Korea. At the same time, the EU’s trade balance with China had fallen by 26%, compared to 15.5% for the USA. It also pointed out that France and Germany had combined debt forgiveness figures of $5.3 billion, five times the amount of the US’s $1.02 billion, and that the US still owed the United Nations arrears in sum of $16 billion.