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U.S., E.U. Call for Market-Driven Restructuring of Steel
04/20/2016 - The European Union and seven countries, including the U.S., Canada and Mexico, have called for a market-driven restructuring of the world’s steel industry as the way to resolve the capacity crisis.
“Promoting such restructuring would result in more efficient resource allocation in economies, with positive impacts on overall productivity and economic performance,” officials wrote in a joint statement.
The statement followed a steel industry summit held Monday in Brussels. The summit, organized by Belgium and the Organisation for Economic Co-operation and Development, ended without any commitments among nations to reduce capacity.
There was, however, agreement among North America, the E.U., Japan, Korea, Switzerland, and Turkey that the industry’s current problems arise from government programs and policies supporting excess capacity.
“In this context, a rising number of anti-dumping, subsidy and safeguard trade actions have been taken, which has contributed to growing trade tensions,” they wrote.
They also agreed that there were several steps that should be taken, including formation of an information-sharing system focused on changes in crude steel capacity and monitoring of export credit agency deals that support new steel projects.
In a separate statement, U.S. Commerce Secretary Penny Pritzker and U.S. Trade Representative Michael Froman said China, which was represented at the summit, was not prepared to accept that its support of its domestic industry has led to massive overcapacity.
The Canadian Steel Producers Association today said China’s unwillingness is “disappointing.”
“Further dialogue through the OECD will now require sustained efforts by the signatory governments in working to build consensus for the implementation of principles as outlined in the (joint statement)," said association president Joseph Galimberti.
"We believe that continued multilateral engagement towards meaningful action to address the causes of the current excess capacity problem is crucial to achieving stability in the sector," he said.
China officials have said that while they recognize a need to cut the country's domestic capacity, the excess is a global problem requiring shared solutions. They also said China is already doing its part, promising to cut capacity by 100 million to 150 million metric tons over the next five years.
And China’s official news service wrote in a commentary that blaming the country for the problem is a “lame and lazy” excuse for protectionism.
The statement followed a steel industry summit held Monday in Brussels. The summit, organized by Belgium and the Organisation for Economic Co-operation and Development, ended without any commitments among nations to reduce capacity.
There was, however, agreement among North America, the E.U., Japan, Korea, Switzerland, and Turkey that the industry’s current problems arise from government programs and policies supporting excess capacity.
“In this context, a rising number of anti-dumping, subsidy and safeguard trade actions have been taken, which has contributed to growing trade tensions,” they wrote.
They also agreed that there were several steps that should be taken, including formation of an information-sharing system focused on changes in crude steel capacity and monitoring of export credit agency deals that support new steel projects.
In a separate statement, U.S. Commerce Secretary Penny Pritzker and U.S. Trade Representative Michael Froman said China, which was represented at the summit, was not prepared to accept that its support of its domestic industry has led to massive overcapacity.
The Canadian Steel Producers Association today said China’s unwillingness is “disappointing.”
“Further dialogue through the OECD will now require sustained efforts by the signatory governments in working to build consensus for the implementation of principles as outlined in the (joint statement)," said association president Joseph Galimberti.
"We believe that continued multilateral engagement towards meaningful action to address the causes of the current excess capacity problem is crucial to achieving stability in the sector," he said.
China officials have said that while they recognize a need to cut the country's domestic capacity, the excess is a global problem requiring shared solutions. They also said China is already doing its part, promising to cut capacity by 100 million to 150 million metric tons over the next five years.
And China’s official news service wrote in a commentary that blaming the country for the problem is a “lame and lazy” excuse for protectionism.
