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Clinton imposes tarrifs on steel rod, pipe imports

WASHINGTON: President Bill Clinton has decided to impose higher tariffs on steel rod and line pipe imports in a move that could increase trade tensions between the United States and Japan, a U.S. official said on Friday.

Clinton will impose the tariffs on imported steel wire rod, which is used to make hangers, cables and fasteners, as well as imported line pipe, according to draft White House statements. The tariffs will remain in place for three years and aim to help U.S. firms hit by low-cost imports, chiefly from Asia.

U.S. steelmakers in May 1999 asked Clinton to limit imports of carbon and alloy steel wire rod that have flooded the U.S. market as a result of the Asian financial crisis. Japan's trade minister had warned that tariffs could spark a protectionist backlash and undermine U.S.-Japan' efforts to free up trade.

In the draft statements, the White House said Clinton would impose a 10 percent tariff on imports of steel wire rod above 1.58 million net tons in the first year. In the second and third years, the quantity of imports exempt from the higher duty will rise by two percent per year and the level of the tariff will fall by 2.5 percentage points per year. It did not specify which countries would be subject to the new tariff.

The statements said imports of line pipe above 9,000 net tons from any country would be subject to an additional 19 percent ad valorem tariff in the first year. In the second year this would drop to 15 percent and in the third year to 11 percent.

U.S. steelmakers welcomed the decision, though some had pressed for higher duties. "There's been a bloodletting in the market. The companies have been beat up. Employment has been very severely impacted," said Charles Verrill, attorney for the steelmakers in the wire rod case. "I would have preferred more, but 10 percent I'll take." -Reuters