United States Steel Decision Disappointing

The decision by United States president George W Bush to impose a tariff of 30 per cent, reducing to 18 per cent, over the next three years on steel products that New Zealand exports was disappointing, Trade Negotiations Minister Jim Sutton said today.

"The Government will take advice on what further steps can be taken to get this tariff removed, including, if necessary, whether the United States' actions are consistent with its obligations to New Zealand under international rules."

Mr Sutton said he understood the steel industry was a powerful lobbyist in the United States - its steelworkers' union was the largest group protesting outside the World Trade Organisation meeting in Seattle in 1999 and it faced structural adjustment difficulties.

However, he said, it was the New Zealand Government's view that the situation did not justify the imposition of import restrictions on steel imports from New Zealand.

New Zealand steel exports to the United States have decreased recently, but nevertheless, the small but steady trade in steel with the United States was of substantial interest to New Zealand exporters.

"While the New Zealand Government recognises the need for the United States steel sector to adjust to changing world market conditions, it does not consider that this should be at the expense of unsubsidised imports through the imposition of import restrictions."

Mr Sutton said New Zealand, and other affected countries, had 120 days to consult with the United States administration, and to explore what other options there might be for a solution to this issue.

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