U.S., other countries call for urgent action on steel overcapacity

Tue Apr 19, 2016 11:06pm EDT
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WASHINGTON (Reuters) - The United States and seven other countries called on Tuesday for urgent action to address global steel overcapacity, a day after China and other major steel producing countries failed to agree on measures to tackle an industry crisis.

Representatives of the United States, Canada, the European Union, Japan, Mexico, South Korea, Switzerland and Turkey agreed that urgent steel industry restructuring was imperative, and must be market driven, according to a joint statement released by the U.S. Department of Commerce.

They also agreed that their governments should not provide subsidies or other support that sustain loss-making steel plants or encourage additional capacity.

In a separate statement, U.S. officials said they would continue to lobby for action on steel with trade partners.

"It is our shared goal that other economies, including China, will come to recognize the value of these actions and will join our collective effort to address the causes of the current excess capacity problem," Secretary of Commerce Penny Pritzker and U.S. Trade Representative Michael Froman said in a separate statement.

"The United States will continue to engage bilaterally and multilaterally with trading partners, including China, to take meaningful action to meet that goal."

A meeting of ministers and trade officials from over 30 countries, hosted by Belgium and the OECD on Monday, concluded only that overcapacity had to be dealt with in a swift and structural way.

Washington pointed the finger at China for the talks failure, saying Beijing needed to cut overcapacity or face possible trade action from other countries.

But Chinese officials said it was already taking sufficient steps to curb capacity, while state news said blaming China for the global steel industry crisis was a lazy excuse for protectionism that would be counter-productive.   Continued...

An employee unloads steel products at a market in Yichang, Hubei Province, China, April 7, 2016. REUTERS/China Daily/File Photo