Tokyo to impose tariffs on U.S. iron and steel

TOKYO Japan will impose tariffs of about 30 percent on U.S. iron and steel products as early as this year in retaliation for U.S. duties on Japanese steel, Trade Ministry officials said on Friday.

Japan will also raise tariffs on clothing, leather and household goods by about 5 percent, said two officials from the Ministry of Economy, Trade and Industry.

The proposed tariffs will be submitted to the World Trade Organization after they are approved by a customs committee in the Ministry of Finance Wednesday, the officials said.

At the request of the U.S. steel industry, the Bush administration implemented the duties on Japanese steel imports in March 2002. A WTO panel ruled them to be illegal on July 11, and Washington lost an appeal of that decision in a final ruling this month. Japan will be able to impose the tariffs 30 days after reporting the plan to the WTO.

Steel products make up about 40 percent of the ¥10.7 billion, or $98 million, in U.S. imports subject to the extra duties. But only 10,000 tons of the 2.74 million tons of ordinary steel imported in the year ended on March 31 came from the United States, said a spokesman for the Japan Iron and Steel Federation.

European Union policy makers last year drew up a list of U.S. products targeted for retaliatory tariffs, including agricultural goods and products from states considered important to President George W. Bush's re-election campaign. Those tariffs are to take effect next month unless Washington relents.

Bush is on a state visit to Britain, which has also criticized U.S. steel policy. The WTO's director general, Supachai Panitchpakdi, said he supported British efforts to persuade Washington to drop the tariffs.

China will take retaliatory measures if the United States fails to lift its illegal tariff on steel products, a senior official said Thursday.

"We will raise tariffs on some US imports and are studying the details of how to do so,'' said Vice-Minister of Commerce Ma Xiuhong when asked how China would respond if the United States did not abide by a recent World Trade Organization (WTO) ruling.

The WTO Appellate Body ruled last Monday that US safeguards for its steel industry are inconsistent with WTO rules, upholding the major findings of a July ruling.

China, along with the European Union, Japan, the Republic of Korea, Switzerland, Norway, New Zealand and Brazil, complained to the Geneva-based WTO over the steel duties. The duties were initially levied at up to 30 per cent from March 2002 but subsequently reduced slightly.

Members affected by the US measures will be entitled to apply for redress and take other appropriate action in accordance with WTO rules, unless the safeguards are withdrawn.

The European Commission has drawn up a hit list of US imports worth about US$2.2 billion a year -- including motorcycles, citrus fruits and textiles -- which will be targeted with retaliatory sanctions.

EC Trade Commissioner Pascal Lamy has said the retaliatory import tariffs could be in place as soon as early December if the United States does not back down now.

Japan is also considering raising duties on at least five products in retaliation against import tariffs protecting the US steel industry, the daily Nihon Keizai Shimbun (Nikkei) said earlier this week.

Quoting Trade Ministry sources, the Nikkei said the products Japan was considering as targets for the retaliatory tariffs included coal, chemicals, steel, textiles and electrical machinery.

If introduced, the tariffs would cost US exporters 10 billion yen (US$91 million) a year, the paper said.

US Secretary of State Colin Powell said on Wednesday President George W. Bush will decide in a "short period of time'' whether or not to rollback disputed steel tariffs that have threatened a new transatlantic trade war.

Ma said the United States should withdraw the safeguard measures without delay since the WTO has made a ruling against them.

But European trade officials dismissed the potential compromise from US steelmakers that would reduce contentious steel tariffs, saying the tariffs remain illegal and ought to be completely removed.

The US safeguard measures triggered a new round of trade protectionism in the global steel industry, with the European Union, Canada and Japan rushing to protect domestic markets from steel exports that might be diverted from the United States.

China followed suit with temporary measures introduced for six months last May. They were extended to three years upon their expiration in mid-November.

Seriously, what do we produce (outside of grains) that the Chi-coms would have any desire to buy?

Semiconductor fabrication processes, fiber optic manufacturing processes, any high tech products that carry intellectual property that the Chinese don't have (yet), jetliners, military hardware, software operating systems, etc. Much of this is obtainable elsewhere also, but the question was whether the Chinese would have any desire at all to buy these.

I agree. IMO, the low Chinese labor costs don't really show up as much lower prices for most items (why should they, when they are only a small to moderate fraction of the total cost of manufacture of most items?), and most of these goods are obtainable at comparable prices from other countries that don't pose such a long term threat to US employment by actively trying to usurp large scale US technological advantages.

We should cut them off completely since all they're doing is flooding our markets with products made from slave labor while putting Americans out of work.

I've never seen so many people as on this site be so happy that their president is raising their federal taxes (which is what tariffs are). tell me, do you believe you can tax your way into prosperity?

I wasn't aware that we still produced anything... Seriously, what do we produce (outside of grains) that the Chi-coms would have any desire to buy?

You miss point. Look at Boeing, maker of jet airplanes. Let say Boeing now makes plane with cheap Chinese steel. If America imposes tariffs to encourage use of domestic steel, then Boeing has to spend more to buy parts for airplane. Therefore cost of airplane is higher. With higher cost, airline less likely to buy Boeing and instead for Airbus. The result in net loss to American economy.

American workers have no choice but to accept $3.00 an hour wages in this new, wonderful globalized world? If that's the case I'll take isolationism anyday.

No. American workers cannot compete with China workers in areas China workers produce in. So they need to move to other jobs. Net result of free trade is more jobs and more economy activity, so this is good. You cannot take isolationism because this is not option any more. It is either globalization or North Korea economy. There is not middle ground.

What part of the country are you in?

I am in Jerusalem.

Here in NY State I can assure you that t-shirt that was once made in the states and usually priced around $15-20 dollars

I do not wear "t-shirt" so does not apply, but principle remains. You pay more and get less because not enough competition, not because of globalization. Solution is more competition not isolationism.

The only ones winning in this free trade scam are the corporations who dumped American workers for the .20 an hour foreign labor, they're getting rich. Everyone else is getting the shaft.

This should be conservative capitalist website? Why to get socialist?

...and most of these goods are obtainable at comparable prices from other countries that don't pose such a long term threat to US employment by actively trying to usurp large scale US technological advantages.

Exactly. It's not about cutting off trade or competition, only doing what's in the best interest of the country. While China steals our technology and dumps their products on our markets, they buy little from us. At some point we either level the playing field or tell them to get lost.

What do you think is going to be the result of these tariffs, t-shirts, dressing gowns, robes and brassieres will suddenly double in price? Is that the tax you're referring to?

First of all, even if all these products were made only in the USA by union labor, the price of them would not be much higher than they are now. As so many people around the nation have confirmed, their costs coming in from the slave labor countries have not gone down hardly at all. But it doesn't matter because China is not the only importer of these goods, there's plenty of competition out there to keep prices stable.

I'd rather we only traded with those whose employees make comparable wages, then Americans wouldn't have to worry about getting undercutted. That was our trade policy for 200 years and it worked. These free trade agreements like NAFTA with third world countries are recent policy, and they are putting Americans out of work by the millions. At this pace we're not going to have a middle class much longer.

I'd rather we only traded with those whose employees make comparable wages, then Americans wouldn't have to worry about getting undercutted. That was our trade policy for 200 years and it worked

that doesn't make any sense. a lawyer's salary is nowhere "comparable" to a casual laborer's, but both benefit when the lawyer hires him to cut the grass (he saves times, the other earns money).
to think trade is good only with people on your salary level is absurd. Sir, have you ever studied economics? thank you.

American workers cannot compete with China workers in areas China workers produce in.

Not sure what you're talking about, you referring to wages or the abililty to make the products? The US used to have a very large textile industry and was second to none in the world, as was our automobile industry, computer industry, and just about any other industry you can think of. No matter the product, we can make them and better than anyone.

We are giving it all away though through free trade agreements with countries whose labor standards are so far below ours in every category that an American corporation who didn't take advantage of it and move there would be crazy. They are saving a ton of money but not passing those savings onto the consumer. It is corporate welfare, nothing less.

And I would add, globalization is a desired policy by some, not a necessary one. We could and have done just fine without trade agreements with Mexico or China. To suggest we must do this or commit suicide as you have is a faulty premise to begin with, and unfortunately one many people have bought into. But not for much longer, as millions of Americans lose their jobs to policies few desire or agree with, there will be changes. Political realities are already forcing Bush to make them.

...to think trade is good only with people on your salary level is absurd. Sir, have you ever studied economics? thank you.

Oh here we go with the "you have to have 10 years of economic classes in college otherwise you're not a genius like me". Give it a rest.

You cannot deny that these trade agreements with third world countries are recent policy, for 200 years we did just fine with limited forms of protectionism and trade with countries more or less on economic par with us.

This is about countries who flood our markets with their products using slave labor but take nothing in return. The result is millions of people being put out of work, and I don't need 10 years of college in Harvard to see it. thank-you

for 200 years we did just fine with limited forms of protectionism and trade with countries more or less on economic par with us.

any country can do just fine with some protectionism when foreign trade is insignificant because it takes 2 months to cross the atlantic. this is a global era, if the US wants to play the protectionist, it will get marginalized by other countries less intent on intentional self-impoverishment.

this is a global era

Who says, the Wall St. Journal?

if the US wants to play the protectionist, it will get marginalized by other countries less intent on intentional self-impoverishment.

You're forgetting, the United States is the largest market in the world, they need us, we don't need them. If we stop trading completely with China our lives will go on as usual, but they will have few if any to buy their shoddy products will they? Their workers barely make enough to survive, they can't afford them.

Bush, whatever his reasons is doing the right thing. He's saying to China "play fair, or we'll get tough". Reagan did it in the 80s with Japan, I applauded for him it and will Bush as well.

I am like many Free Republic posters a social conservative. I am hardly a socialist on econimic issues, I dont believe in state ownership of industries and I am distressed that taxes even since 72 have dramatically gine up for the middle class. That said, I do not care for globalism, outdated economic theories from the Hoover Institute and Corporatism. I think the US govrenment, and this is not a socialist stand, has a duty to protect the economic standing of the citizens, not just the standing of a few.

Alter, as I have said in a few other posts, you will find a bit of diversity in the Republican party and on Free Republic. Many people vote Republican because of just 3 issues, guns, abortion and race.

Sorry, but how Free Trade is defined right now, meaning a unidirectional flow of trade towrds the US, is not sustainable, and will have many long term impacts, such as America being ever deeper in debt to various foreign intrests. Another long term impact is political, as the majority of citizens will get fed up and vote those in power that vow to protect their economic intrests.

The need and clean economic propaganda spewed forth by the WSJ is tunnel vision.

If we stop trading completely with China our lives will go on as usual

this one is a keeper. to think you can isolate the US from a multi-trillion economy with a billion potential customers without a zilch of impact........... (shaking my head in dismay)

this one is a keeper. to think you can isolate the US from a multi-trillion economy with a billion potential customers without a zilch of impact........... (shaking my head in dismay)

If you read post #26 you would have learned we have an $11.3 billion trade deficit with China. Potentially yes they are a huge market for American businesses, but their workers cannot afford to buy our products, which explains the huge discrepancy. It also explains why American businesses are packing up for China, because their wage rate is so low. But you knew that right?

Perhaps you'd like to tell us all what Chinese consumers in a communist country btw are currently purchasing from the USA?

Being a Steel Worker, I welcome the tariffs. When I go into one of the Chi-Marts and see Stanley tools Made in China, Farberware pots, pans and silverware made in China , and GE refrigerators made in China (to name a few) while our factory goes through another bout of downsizing and concessions, I welcome the tariffs. It beats the sytstem we now have in place.

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