International Information Programs
Office of Research Issue Focus Foreign Media Reaction

December 10, 2003

December 10, 2003





** The U.S. "climb down" on steel was "overdue" but encouraging; it averted a global trade war.


** Media portray Washington's decision to scrap steel tariffs as a "victory" for the WTO.


** Critics, both left and right, say it's too early to celebrate; the truce over tariffs is "still fragile."


** The move to lift tariffs is a "political calculation" motivated by the president's re-election bid.




Though 'overdue,' the U.S. finally made the 'right move'--  Making a point of noting that the "punitive tariffs" were a mistake to begin with, business and conservative dailies welcomed the decision to rescind them as "better late than never" because it will "avert a ruinous trade war."  Questioning the advantage of protectionism to the U.S. economy, Asian, Euro and Canadian dailies were "hopeful" that the U.S. gesture of scrapping its "steep tariffs" will overcome "friction" in other trade areas.  On behalf of the optimists, Canada's National Post mused: "We hope this is a sign he is returning to the free-trade policies he endorsed before being elected."  But Seoul's Segye Ilbo put Washington on notice, saying "the U.S. must learn through this experience that it should not try to manipulate the global market by using its political influence."


U.S. only 'conceded' because of 'retaliatory threats' from EU and Asia--  Loath to praise the Bush administration for lifting what editorialists worldwide had denounced as an "egregious" policy, observers credited the WTO for forcing Washington to "give in" to international pressure.  Euro, Asian and Latin papers hailed the WTO for reasserting its "rightful role" in stopping the U.S.' "bullying the global trade scene," declaring the move an "undeniable" victory for the WTO.  Voicing a common view, Brazil's independent Jornal da Tarde noted that Bush has "finally recognized" that, "at least in the trade area, even the world's most powerful nation...must submit to international rules."


'No reason to celebrate'--  Detractors were not convinced that the "steel retreat" meant a change in U.S. trade policy and expected the U.S. to apply the "poison of protectionism" in other areas.  The announcement of restrictions on Chinese textiles imports, asserted Spain's business Cinco Dias, "is a clear warning sign" while a center-left German daily added, "we cannot expect a turn in U.S. trade policy."  Joining critics in accusing Bush of "again pursuing the crassest of political courses," Canada's leading Globe and Mail averred: "Sadly, the retreat on steel does not mean the administration is about to change its protectionist habits." 


Politics 'weighed heavily' on the decision to end steel tariffs--  Echoing charges in 2002 that the U.S. imposed steel curbs to cater to the rust belt in the run-up to congressional elections then, now editorials portray the move as politically calculated to help Bush in 2004.  In the upcoming election year, "Bush could not afford to run the risk of upsetting exporting states, like Florida, which remained faithful to him," explained Belgium's financial L'Echo.  Liberal papers held that Bush "used the same election tactical calculations as when he introduced the steel tariffs."  Yet others warned of a "political backlash."  It could be "dangerous," said Italy's centrist La Stampa, "steel unions are on the war path."


EDITOR: Irene Marr

EDITOR'S NOTE:  This analysis is based on 37 reports from 17 countries, December 2-9.  Editorial excerpts from each country are listed from the most recent date.




BRITAIN:  "Bush's Steel Retreat"


An editorial in the independent Financial Times contended (12/8):  "George W. Bush, whose distaste for multilateral organisations is legendary, has met his match.  His reluctant decision last week to rescind steel tariffs, though hardly a glorious moment for the U.S. president, is a triumph for the World Trade Organisation and the rule of international law....  Triumphalism over steel tariffs must not lead the EU to push brinkmanship too far.  Equally, the U.S. must limit that risk by showing unequivocally that it is committed to resisting protectionism and abiding by multilateral rules.  Until it does so, any truce over trade will remain fragile."


"Rolled Over"


The independent weekly Economist remarked (12/6-12):  "It would be nice to think that a chastened Mr. Bush had recovered his zeal for free trade. The truth is that the White House's  electoral college-vote-counters led by Karl Rove realized that a fight with Europe, as well as with the steel making countries in Asia who stood ready to pile in, was not worth it....  The EU's strategy of retaliation was especially clever.  It would slap new tariffs on Floridian oranges and a host of other American exports from Republican southern and western states.  The last thing Mr. Rove wanted was for textile workers in the Carolinas to start voting Democratic....  Even if Mr. Bush's political calculations on steel prove correct, his problems with trade are far from over.  Should he reach a separate peace in this tussle, there is another, bigger dispute with Europe over America's tax relief for exporters.  The deadline for resolving it is New Year's Eve. Don't expect the White House's enthusiasm for free trade to last that long."


"President Bush, Tear Down Those Trade Barriers"


An editorial in the conservative Daily Telegraph noted (12/5):  "As Governor of Texas with a close interest in Mexico, George W. Bush was known as an advocate of free trade.  As president, he has squandered much of that reputation by two measures introduced last year.  The first was new tariffs of up to 30 per cent on a wide range of steel imports.  The second was the Farm Security and Rural Investment Act, with large subsidies for U.S. producers of cotton, cereals and soya beans. The dire effects on farmers in poor countries were highlighted at the abortive world trade talks in Cancun in September.   Protection of the steel industry incensed foreign suppliers and important sectors of domestic opinion....   As leader of the free world, the United States has a special responsibility to uphold a trading system with free exchange of goods and services.  The steel tariffs and the farm Bill have sadly undermined its authority in an area where it should be an exemplar."


"Trade Hopes"


The independent Financial Times commented (12/2):  "If the U.S. rescinds its illegal steel tariffs this month, as now expected, it will be a case of better late than never.  The curbs should never have been imposed.  But their removal will be welcome, nonetheless.  It will avert a ruinous trade war, benefit the U.S. economy and reinforce the rule of international law.  Washington appears to have been swayed by European Union pressure and the threat of sanctions.  The EU has been right to stand firm.  Now it needs to show it is as tenacious at lowering long-standing trade barriers--including its own--as at fighting the erection of new ones.  On that, its performance so far is less impressive....  European politicians constantly proclaim their yearning for greater global influence.  Now is the time to show the EU deserves such a role.  Trade ministers should instruct the Commission today to draw up bolder proposals and negotiate on them seriously.  The only thing Europe has to lose is the handicap its trade barriers inflict on its own economic performance."


GERMANY:  "After The Steel Thunderstorm"


Alexander Hagelueken opined in center-left Sueddeutsche of Munich (12/6): "The president conceded only because the threatened EU retaliation would have hurt domestic producers and voters, and the low dollar is currently giving them enough protection from imports, anyway.  In other areas, Bush is making liberal use of the poison of protectionism, which is slowly but surely destroying the foundations of the world trade system. Whether he stops Chinese T-shirts at the border or wants to maintain export subsidies for Boeing and Microsoft, he's being in economic terms the same isolationist he was politically over Iraq, or when he sabotaged the Kyoto Protocol.  At the same time, he can point his finger at trading partners who don't always behave themselves either, like the EU, which is likely to postpone today a decision to approve a variety of BT corn, thus once again extending a ban on approvals for U.S. GMO plants that contradicts that spirit of free trade.  Given that both sides are pursuing such policies, it is no surprise that the larger project of a global trade agreement is bogged down.  The multilateral trading system is in crisis at the very moment everybody is hoping growth will return....  The revival of the trade round can only come from the high priests of capitalism.  In Cancun, both Europeans and Americans were surprised by the determination with which the poor countries pressed their demands.  They have no choice but to accept the new reality and sacrifice their absurd farm and textile protectionism.  But the Europeans refuse to budge, preferring to leave that to others.  And the U.S. is concerned only with the election campaign.  Apart from that, the U.S. government acts as if there will never be another world trade agreement, and tries to force poorer countries to accept bilateral trade agreements that leave decisions to the stronger.  The consequences of this strategy will haunt the world long after Bush's steel intermezzo has been forgotten."


"Overdue Decision"


Center-right Frankfurter Allgemeine stated (12/2):  "Now President Bush obviously wrestled through to lift punitive tariffs on cheaper foreign steel earlier than planned.  George W. Bush's decision is overdue.  By erecting this trade barrier, the U.S. president did his country a bad service.  The steel-processing industries in the United States have had top pay higher prices since then....  The punitive tariffs may have delayed the necessary staff reductions in U.S. steel industry, but they have not prevented them.  We cannot expect a turn in U.S. trade policy.  The decision was made only under pressure from U.S. trading partners and looming sanctions amounting to billions of dollars.  Regrettably, it does not spring from the insight that U.S. protectionism is detrimental not only to the Europeans, Japanese, Brazilians, and many other, nor did it result in the promised usefulness for the U.S. economy."


"Tariff Cuts For The Voters"


Marc Hujer penned in center-left Sueddeutsche Zeitung of Munich (12/2):  "For a moment the world can heave a sigh of relief....  If the punitive tariffs are abolished, this will not only success for Europe and Asia, but also a victory for the international community, which is dependent on the United States and its robust demand....  The good news is that there are limits of protectionism today and that the economies are linked so closely to each other that no government, not even the Bush administration, can afford to stop trading.  The bad news is that Bush did not act on insight but used the same election tactical calculations he used when he introduced the steel tariffs....  The Europeans...have not yet managed to change the president's view.  Someone like him is not an unconditional supporter of free trade.  It is part of Bush's success not to have a clear opinion.  Today he is pleasing U.S. industry with tax cuts, while, on the following day he is putting it off with an increase in spending....  The same is true for trade policy.  Bush talks over and over of the advantage of an international exchange of goods, but only if it is necessary.  While he is abolishing steel tariffs, he is planning new tariffs on textile imports from China.  The fear of losing the next elections is still greater than the hope that free trade will, in the end, be beneficial to all."


"Coaching From The WTO"


Business daily Financial Times Deutschland of Hamburg had this to say (12/2):  "All indications are that President Bush will now give in and lift the tariffs....  The decisive factor was the WTO decision, since even the powerful United States shies away from openly breaking WTO rules....  It would be even better if the president now came to the insight that trade wars like this only have losers....  The U.S. government must simply recognize that the domestic steel industry is simply producing steel that is too expensive.  No country can afford to finance such competitive weakness for a long time."


"Victory For The WTO"


Maren Peters said in an editorial in centrist Der Tagesspiegel of Berlin (12/2):  "It seems that the WTO has gained the upper hand in the controversy with the powerful United States.  But it would be too early to celebrate the victory of the WTO over protectionism.  The steel conflict is only a minor link in a long series of trade conflicts....  But the steel dispute gives the WTO, whose end was predicted in Cancun two months ago, a new authority.  It shows that its arbitration mechanism works.  The victory in the steel conflict creates hopes that a result can still be achieved at the stagnating WTO round about a further easing of trade rules."


ITALY:  "Bush Says Good-Bye to Steel Tariffs--'Free Trade Is The Priority"


Maurizio Molinari noted in centrist, influential La Stampa (12/5): "George Bush rescinded the tariffs on steel imports 11 days before the EU ultimatum deadline....  At the end of a twenty month-long tug of war with the EU, Japan, and South Korea and after the WTO's ruling that they were illegal, the White House lifted the tariffs explaining that 'they had achieved their purpose.' British PM Tony Blair had particularly insisted that Bush abolish the duties during his recent bilateral meetings on Downing Street.  But Bush's decision may be dangerous. Although the problems with Europe have begun to clear, steel unions are on the war path."


"Bush Gives In And Rescinds Steel Tariffs"


Marco Valsania reported in leading business Il Sole-24 Ore (12/5): "The Bush Administration has rescinded steel tariffs, giving in to the WTO's ruling, to the retaliatory threats of European and Asian partners and to the looming global trade war. The formal announcement came yesterday in a presidential communiqué: 'The time has come,' he said, ' to cancel the protective measures.' The European reply came quickly: the EU immediately called off preparations for retaliation.  The reversal was not easy for Washington: internal tensions were apparent by the announcement itself, which was entrusted to press advisories and a spokesperson only after frantic meetings between the President's advisors.  Bush tried to soften the blow for the U.S. steel industry--without for the moment angering his international partners--by promising to defend the industry's interests with less forceful means. The new measures include monitoring foreign companies and their exports to the U.S. with the objective to avoid large flows of foreign steel into the U.S."


"Steel, Bush Gives In To EU"


Ennio Caretto opined in centrist, top-circulation Corriere della Sera (12/2):  "Bush does not want an international trade war after Japan and other countries threatened to impose sanctions of 2.2 billion dollars on U.S. products; most of all, he does not want the sanctions to have repercussions on key electoral states like Florida."


"Bush Ready To Announce Revocation Of Steel Tariffs"


Mario Platero wrote in leading business daily Il Sole-24 Ore (12/2):  "Tariffs on steel imports in the U.S., which were imposed one year and a half ago for domestic reasons...were in clear violation of international accords.  Therefore, Europe wins.  It has always kept a hard line and yesterday it reiterated its readiness to impose sanctions of 2.2 billion dollars if the U.S. didn't lift all its tariffs; the WTO wins, strengthening its role as multilateral arbiter.  Most of all, the international situation wins:  since the global economy is picking up speed, and the American one in particular, fomenting a trade war between the main actors of the recovery could have had disastrous consequences."


BELGIUM:  "Who Is The Real Winner"


Jean-Pierre Coppens in financial L’Echo editorialized (12/6):  “President Bush has ended the tariffs on steel imports.  It is an important victory that all are claiming.  First, the WTO, which on two occasions condemned the American protectionist policy.  Secondly, the plaintiff countries and the EU, which now state that the U.S. market is henceforth open to exporters.  Lastly, President Bush himself, who can pride himself with having avoided sanctions that the United States’ main trading partners were going to enforce.  In this electoral year 2004, Bush could not afford to run the risk of upsetting exporting States, like Florida, which remained faithful to him....  It is undeniable that it is a victory for the WTO. Yet, it is obvious that President Bush was more concerned by the consequences of sanctions than by a condemnation, even if the latter came from an internationally recognized body. Bush could simply not afford to upset the United States’ main trading partners....  The plaintiff countries should think twice before crowing over their victory. Indeed, European steel sector circles are underlining the possibilities that the U.S. steel sector and the U.S. Administration have to circumvent the official end of the protectionist measures. There are many options, and if U.S. steel manufacturers voice their fears, the Bush Administration might adopt an attitude that would be favorable to them.  That would mean back to square one, with another complaint before the WTO, another threat with sanctions, and another loss of time and of market shares. So, who are the real winners?”


IRELAND:  "Bush Blinks First In Face Of Trade War"


Conor O'Clery held in the center-left Irish Times (12/5):  "Mr. Bush declared that his temporary steel tariffs had succeeded in giving the U.S. steel industry enough time to restructure but, in a concession to the steel industry, ordered a system of steel-import licensing to spot any surge of steel imports....  By lifting the duties of up to 30 per cent on steel imports 15 months earlier than planned, the Bush administration has avoided 100 per cent EU sanctions on such items as U.S. orange juice, motor cycles, vegetables and cigarettes.  Politics weighed heavily on the decision to end the tariffs, introduced in March 2002 to protect inefficient U.S. steel producers. The steel-producing states of Pennsylvania, West Virginia and Ohio could prove vital to Mr. Bush's re-election in 2004, while many crucial swing states produced the exports targeted by the EU.   U.S. trade representative Mr. Robert Zoellick said the prospects for U.S. steel had improved since March 2002 with demand rising in China and Russia, and cutbacks in U.S. steel output by four million tons. The benefits to the industry no longer outweighed the 'marginal cost' to consumers, he said....  In contrast to his usual practice of personally making major policy announcements, Mr. Bush made his decision known in a written statement issued by his press secretary."


"Bush Pressed For Steel Decision"


Conor O'Clery wrote in the center-left Irish Times (12/2):  "U.S. President George Bush is under pressure from his advisers to cut back U.S. tariffs on foreign-made steel to avoid a global trade war.  A decision is likely before the end of the week.  Whatever he does, Mr. Bush faces a political backlash which could have ramifications in next year's presidential elections....  By ending them Mr. Bush risks losing support in Pennsylvania, Ohio and West Virginia, the states where most American steel is manufactured.  By keeping the tariffs, however, Mr. Bush risks infuriating manufacturing interests in states like Michigan and Minnesota where the protectionist measures have kept steel prices high.  Key White House advisers and U.S. trade representative Mr. Robert Zoellick have recommended an end to the tariffs because of the even more serious risk of a world trade war....  The president will also be weighing the counsel of his influential political adviser Mr. Karl Rove, as the states involved account for almost one-third of the 270 electoral votes needed to win the White House in 2004."


NORWAY:  "The U.S. Gives In On Dangerous Steel Quarrel"


The newspaper of record Aftenposten commented (12/8):  "The EU has argued the issue hard.… The interesting thing in this regard is that EU as a power of trade is equal to the U.S.… And it’s been demonstrated how great influence the EU can achieve over U.S. policies when its members stand united and put their total weight on the scale. This will probably also apply on other issues, such as in Iraq and the Middle East.… Since October 2000, the month before Bush was elected President, the USD has dropped by 46 % against the Euro.… The steel quarrel may be a signal that more important matters than a miserable steel tariff is about to change.”


SLOVENIA:  "Goodbye, Tariffs"


Andrej Brstovsek commented in left-of-center Dnevnik (12/5):   "President Bush lifted steel tariffs yesterday, because they had become too heavy a burden before the approaching election campaign. To some extent, the tariffs were lifted because of their unpopularity in states with strong steel-consuming industries, and partly because of the EU’s threat of counter measures.… The steel tariff case is another story demonstrating that election campaign promises expire on the election day.  Both Bush and Gore were supporters of free trade in 2000.  When a member of Bush’s election staff was asked what was the difference in their stances, he said: ‘The fact that we mean it.’ They had meant it until tariffs proved to be a handy political weapon.  Namely, the attitude toward individual political issues may play a crucial role in American politics.  Labor unions support the candidate who is expected to give them more favorable policies.… Therefore, it is not surprising that Bush...has introduced certain political measures for the protection of a domestic industry. He promised steel tariffs before the 2002 Congressional elections, and with them contributed to the Republican victory in steel states. But his [measures] have stopped half way because the tariffs were supposed to be in place for three years. The White House explained yesterday that the measures had achieved their goal.… But, will anyone be satisfied at the end of this story? Two hundred thousand individuals in steel-consuming industries are said to have lost jobs because of the steel tariffs...while steel industry workers will not enjoy their benefits for the full three years. Selling the tariff story as an acceptable economic intervention which protected domestic workers and did not result in a trade war will depend on the President’s skill.  The task will not be easy.”


SPAIN: "Steel And Free Trade"


Centrist La Vanguardia reflected (12/5): "The record of the current U.S. Government is not especially liberal for a Republican one, which typically is in favor of the free trade.   The primary sector is still very subsidized and during this term of office an agricultural law clearly damaging to the developing countries has been  enacted.  Obviously, the failure of the negotiations in Cancun, that put at serious risk the Doha negotiations for trade liberalization, is not only the U.S.' fault, but its attitude has, in general, been tight-fisted."


"Bush Loses The Battle Of The Steel"


Business Cinco Días wrote (12/5):  "Although it would be difficult to specify if finally the external pressures carried more weight than the internal ones, what is clear is that this defeat in the battle of steel shows that the unilateralism imposed by the  Bush Administration in all of its foreign policy is not unbeatable....  In spite of this, there are no reasons to celebrate.  The Bush government's protectionist tendency can worsen with an eye towards the next elections.  And the recent announcement of restrictions on Chinese textile imports is a clear warning sign in this sense."




AUSTRALIA: "Bush Shows Sense By Bending On Steel"


An editorial in the national conservative Australian asserted (12/8):  “Rescinding his harmful steel tariffs last week, President George W. Bush said they had 'achieved their purpose.'...  In truth, the tariffs had only one purpose, which was to shore up the president in key rust-belt states such as West Virginia and Ohio in the run-up to next November's election. In that purpose, the tariffs have now most certainly failed....  In the end, with the tariffs producing a backlash in states like Michigan and Wisconsin--whose key industries use steel, rather than make it--they were not even worth anything politically.  Mr. Bush has learnt at first-hand the chief peril of subordinating trade policy to domestic political imperatives: you can't punish foreign producers without hurting local consumers as well.... If all this has saved some presidential face--fine, now let's move on. Mr. Bush preached a strong free-trade message in 2000 against the born-again protectionist Al Gore. It did him no harm then, and he should go with it again in 2004.”


CHINA:  "Tariffs Harm Others Without Benefiting Oneself"


The independent Chinese-language Hong Kong Economic Journal commented in an editorial (12/5):  "Bush should know very well that protectionism will only harm others without benefiting the U.S. and that a trade war will only further undermine the strength of the global economy.  Steel tariffs will not increase employment opportunities for steel workers.  What's more, research has indicated that the steel tariffs seriously harmed the U.S. industries that use a large quantity of steel.  Imposing import restrictions on Chinese textile products and other products will have little impact on China....  and the restrictions will not help the U.S. textile industry increase its competitiveness.  Furthermore, millions of American consumers will suffer.  Then what is the advantage of protectionism to the U.S. economy?...  The current trend of the U.S. economy is favorable.  The November employment figures show that the labor market is picking up.  Bush has seized this opportunity to announce the removal of steel tariffs....  Giving up protectionism is in the best interest of the U.S. as well as the world.  If Bush can think strategically and make free trade his campaign strategy and the core of his policies, the whole world will heap praises on him."


JAPAN:  "Retraction Of Safeguard Tariffs To End Trade Friction?"


An editorial in the top-circulation, moderate Yomiuri observed (12/6): "The latest decision by President Bush to scrap safeguard tariffs on steel imports has averted a global trade war.  The Bush administration's retraction of safeguards was a calculated move linked to the President's bid for re-election in 2004.  Despite a slight recent improvement in the global economy, it is still uncertain whether this trend will continue. The emergence of a global trade dispute could hamper smooth transactions in services and goods and undermine the slight bounce back in the world economy.  We are hopeful that the U.S. administration's decision to scrap its steep tariffs will serve to overcome friction in other trade areas.  We also hope that Washington will cooperate with Japan and the EU in overcoming the current gridlock in efforts to resume multilateral (WTO) trade talks.     


"Will U.S. Repeal Of Safeguard Tariffs Bring An End To Protectionism?"


 An editorial in the liberal Mainichi observed (12/3): "The Bush administration has reportedly decided to repeal its 20-month 'safeguard' tariffs on imported steel following a final WTO ruling against the U.S. practice and moves among Japan, the EU and other nations to impose retaliatory tariffs on U.S. exports.  It is only natural that the U.S. administration should retract these politically motivated tariffs. With the 2004 presidential election drawing near, the U.S. administration's trade stance appears to have become more protectionist.… Following the WTO ministerial in Cancun, moves are reportedly afoot in the U.S. and other nations to conclude bilateral free trade agreements (FTAs). But the multilateral free trading system is indispensable to make these bilateral FTCs more effective and functional.  Ultimately, trade protectionism and unilateralism will only deal an immeasurable and negative blow to the world economy."


SOUTH KOREA: "Confusion Over Yongsan Base Realignment, Very Disappointing"


The government-owned Daehan Maeil editorialized (12/6): "The Ministry of Defense announced that it received notice from the U.S. that the UNC and CFC will be moved out of Yongsan to the South of the Han River, but after a few hours denied receiving such notice...This type of attitude by the government makes the Korean people more confused and increases the people's concerns over their security.... The government must come forward with the details of its talks with the U.S. on the realignment of the USFK, and ask for the understanding of the people. If the United States' new global military strategy makes it inevitable for changes within the USFK, then the government must admit the true reality to the people and come up with concrete countermeasures. The U.S. must also keep the symbolic significance of the UNC and CFC in mind, as well as the security concerns of Koreans, while seeking for an agreement on this matter with the Korean government."


"U.S. Must Stop Excessively Imposing Safeguard Measures"


The conservative Segye Ilbo editorialized (12/6): "The U.S. announced that it will withdraw its tariffs against imported steel....  Such measures are believed to be taken in fear of possible damages that many states could suffer due to other country's retaliatory actions against U.S. products and agricultural goods....  It is encouraging to see the WTO playing its rightful role in stopping the U.S. bullying the global trade scene....  However, it is true that the U.S. measure was also a result of pressure from the global community, where there have been some changes in the international order, due to the worsening situation in Iraq. The U.S. must learn through this experience that it should not try to manipulate the global market by using its political influence."




INDIA:  "Lesson In Protectionism"


The pro-economic-reforms Business Standard remarked (12/9):  "Most observers will agree that the main reason why U.S. President Bush has withdrawn his import tariffs on foreign steel is not high principle but the fact that, after the WTO found his action illegal, the EU threatened to impose punitive sanctions worth billions of dollars of U.S. exports, judiciously targeted on items like orange juice from Florida, one of the states critical for a Bush's re-election....  Yet, what is drowned in the outcry against the U.S., is the fact that the U.S. steel industry has used the period of tariff protection to restructure itself....  This is the lesson for India which, along with the U.S., is the world's largest user of anti-dumping duties to protect local industry....  If India does feel the need to protect local industry, it makes more sense to use 'safeguard duties' rather than 'anti-dumping' ones, since the rules for invoking safeguards require that Indian industry come out with a concrete plan to restructure itself before getting any protection."


"Steeling For Competition"


An editorial in the pro-economic-reforms Economic Times asserted (12/8):  "The United States has withdrawn the safeguard tariffs it had imposed on steel imports in March 2002 - well before the completion of their three-year term.  Of course, the U.S. president would have the world believe that 'these safeguard measures have now achieved their purpose, and as a result of changed economic circumstances it is time to lift them.'...  It is no coincidence that the U.S. climb-down comes barely a week before the 15 December EU deadline for retaliatory action--following the ruling of the WTO appeals panel that the U.S. duties were 'inconsistent with the WTO Safeguards Agreement and the GATT 1994' - against U.S. exports. The proposed retaliation would have been insignificant compared to annual U.S. exports of nearly Dols. 1,000 billion.... It shows that in a multilateral framework, it is possible for countries to make their voice heard even against the mighty United States. In that sense, it is a victory for the WTO and strengthens the case for free world trade as well. But for the WTO agreement, it would have been difficult to imagine the U.S. backing down like this. The U.S., in turn, has reiterated its commitment to the WTO. Had it not done so, the future of the WTO would have been seriously endangered."




CANADA:  "Backing Down On Tariffs Right Move"


The conservative Gazette observed (12/8): "On softwood lumber, on steel, on farm products, Bush has repeatedly betrayed his - and his party's- rhetoric of trade competition. He has brought in tariffs, quotas, and domestic subsidies that have distorted markets, cost U.S. consumers untold millions, frustrated trade reformers in Latin America and elsewhere, deprived Third World peasants of access to U.S. markets, and slowed the pace of trade liberalization worldwide. So it was a relief to see Bush's administration back down, last week, on steel tariffs brought in a year ago to prop up old-technology U.S. steel firms.  But it's more than a relief, it's downright encouraging, to understand why Bush has reversed himself....  Everyone recognizes the reality: the European Union was about to retaliate with tariff hikes aimed squarely at the exports of certain big states vital to Bush's re-election next year, starting with Florida. But there's another layer to this, and here's the good news: some U.S. commentators have noted that the steel tariffs, while protecting jobs and profits in a few 'steel states' --such as Pennsylvania and West Virginia--were intensely unpopular with whole industries, led by the automotive sector. That's because more-expensive steel means more-expensive cars, and so fewer new-car sales."


"Sound The Steel Retreat"


The leading Globe and Mail opined (12/5):  "The Bush administration does not often acknowledge its mistakes or reverse course.  But it did so yesterday, abandoning punitive duties on steel imports from the European Union, China, Japan and a handful of other countries. The welcome move averts a dangerous trade war.... In making the announcement, U.S. President George W. Bush cloaked himself once again in the garb of an eager apostle of free trade. It is not a convincing act. For all his free-trade rhetoric, Mr. Bush has typically followed the path of political expediency in bowing to pressure from U.S. producers and trade unions for import restraints on such key commodities as farm products, softwood lumber, steel and textiles. Now, in canceling the most egregious of his protectionist measures, he is again pursuing the crassest of political courses.... Sadly, the retreat on steel does not mean the administration is about to change its protectionist habits and return to the traditional Republican embrace of freer trade - not when it faces tough assaults from Democratic opponents who have zeroed in on the heavy job losses that have occurred on Mr. Bush's watch. Yet there is little doubt that protectionism has done far more harm than good for the U.S. economy and the financial markets, while doing nothing for Mr. Bush's credibility when it comes to promoting free trade abroad or defending the interests of consumers at home."


"Turfing Tariffs"


The conservative National Post editorialized (12/5): "George W. Bush was elected President of the United States on a free-trade platform. But once in office, he embraced a variety of politically expedient protectionist causes. One particularly egregious example was Mr. Bush's 2002 decision to enact hefty tariffs on overseas steel....  With less than two weeks to go before the EU's payback was to take legal effect, however, Mr. Bush blinked yesterday, signing a proclamation that ended the tariffs outright.  As with any coddled industry stripped of its privileged treatment, U.S. steel producers are squawking. But this was the right decision. Besides being unfair to foreign producers, the tariffs hurt the overall U.S. manufacturing sector by artificially boosting domestic steel prices. Moreover, flouting the WTO's decision on such a high-profile issue would have delivered a crippling blow to the international body, and might even have called into question the possibility of co-operation on other trade issues. Good on Mr. Bush. We hope this is a sign he is returning to the free-trade policies he endorsed before being elected."


ARGENTINA:  "A Calculated Move"


Paula Lugones, international columnist of leading Clarin commented (12/2):  "Yesterday's move was a very calculated election move targeting (Bush's) re-election--the impact of the elimination or stay of steel subsidies was minutely measured in certain states in comparison with the consequences of possible European sanctions.  While the measure 'could irritate' some districts, it could prevent Europe from imposing tariffs on Florida lemons, Florida being crucial in the tight presidential elections that brought Bush to power.  On the international front, through this measure, Bush would also avoid a confrontation with Europe while he would take an important step toward free trade beyond rhetoric and local interests."


"Commercial And Political Interests Are Entwined"


Ana Baron, Washington-based correspondent, wrote in leading Clarin (12/2):  "In election years, the relationship between commercial and political interests becomes much more frequent than in other time.  Bush's decision to lift steel tariffs imposed only 20 months ago is related to his need for ensuring the support of the powerful lemon producers from Florida, a key state to his re-election.  But this is not the only example.  Currently, the U.S. is negotiating a free trade deal with Australia like the one it reached with Chile.  Nevertheless, this time the Bush administration is attempting to impose a new clause (on Australia) only for election purposes.  The White House wants Australia to eliminate the system whereby the Australian government negotiates the price of medicines manufactured by U.S. pharmaceutical laboratories on behalf of Australian citizens....  Since the financial and political support from the U.S. pharmaceutical industry in an election year is decisive, there is no doubt the White House will insist on imposing this clause....  The most serious thing is that if the U.S. manages to impose this clause on Australia, such a U.S.-Australian deal will set a precedent for all other free trade deals."


BRAZIL:  "Lobby vs. Lobby"


Economic columnist Celso Ming remarked in center-right O Estado de S. Paulo (12/9):  "Bursts of protectionism such as the one resulting in the adoption of safeguards for the U.S. steel industry in 2002, which has now been revoked by President Bush, may occasionally occur.  But they are now up against the logic of the current system of production, which demands fast and cheap global supplies.  This is why they tend to be rescinded....  The lobby formed by steel consumers persuaded President Bush to revoke his safeguards 15 months before they were to end.  This is the result of the dynamics of the global sourcing system, which reacted against the inflated prices of the protected plants....  One of the outcomes of President Bush's decision was the strengthening of the WTO." 


"U.S., WTO, The Steel Case And Lessons For Brazil"


Business-oriented Valor Economico (12/8) editorialized: "Both the WTO and multilateralism have been unquestionably victorious and strengthened as a result of the USG's decision to eliminate the surtaxes it has imposed on steel imports.... The Bush administration took that measure against its will....  Less than one year before the elections that may re-elect him, the president is thinking only in electoral terms.  The barriers against steel imports were aimed at obtaining support from voters in states where the steel industry is important. The decision to rescind them follows the same reasoning....  By accepting the WTO's resolution, Bush has not given any sign that he is more committed to the free trade principles that he defends in speeches and rejects in practice. A clear example of his willingness to maintain protectionism emerged a few hours after the announcement that the surtaxes would be lifted. More anti-dumping measures against imported steel products were announced....  The U.S. anti-dumping legislation is a point of honor for the Bush administration in its international trade discussions, including the FTAA.  By no means will the U.S. administration agree to negotiate it.  Along with the Farm Bill, it is one of the major mechanisms that maintains protection for U.S. products and distorts essential free trade principles....  As long as these instruments are retained, there will be very little real hope of trade liberalization for the less powerful nations around the world."


"A Barrier On Steel Exports Fell, But Another Was Raised"


The lead editorial in center-right O Estado de S. Paulo opined (12/6): "Only a few hours after having announced the end of barriers it had imposed on steel imports, the USG once again demonstrated its inclination to adopt protectionist measures.... While making public the decision, the U.S. administration had already prepared another anti-dumping measure, this one affecting exporters of steel cables used in concrete construction. The Bush administration avoided the retaliation authorized by the WTO, but opened another [path to] confrontation on trade. Once again Brazil is one of the nations most affected....  Even without explicitly contradicting the WTO, the USG will always be ready to act unilaterally in accordance with its domestic or foreign interests. Such a trend has become more evident in the Bush administration....  Almost all of its decisions about international trade have been marked by protectionism."


"Respect For International Rules"


Independent Jornal da Tarde editorialized 12/8): "Although it had some economic consequences, President George W. Bush's decision to revoke the barriers he had imposed against steel imports is particularly important because of its special political significance. With the decision, Bush has recognized, at least in the trade area, that even the world's most powerful nation in economic and military terms must submit to international rules. The withdrawal of the barriers will not result in any flood of imported steel into the U.S. market. The dollar's devaluation against the euro and the yen has made U.S. imports more expensive. Significant changes in the world steel market since the beginning of last year have also discouraged exports to the U.S.... While making the decision to revoke the barriers, Bush and his staff certainly took into consideration the political cost that trade retaliation would impose on the White House at the very moment when the electoral campaign is beginning."




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