Gov’t meets titans of steel to discuss EU safeguardsThe government met with representatives from the local steel industry on Thursday to discuss the impact that EU’s safeguard on 23 steel products would have on Korean steel exports, which are also facing pressure from U.S. protectionist measures.
The European Commission on Wednesday announced that it will impose provisional safeguard measures as a response to U.S. steel tariffs.
“The U.S. tariffs on steel products are causing trade diversion, which may result in serious harm to EU steelmakers and workers in the industry,” said EU Trade Commissioner Cecilia Malmstrom. “We are left with no other choice than to introduce provisional safeguard measures to protect our domestic industry against a surge of imports.”
The EU announced that it will impose no tariffs on the average amount of steel imported between 2015 and 2017. However, 25 percent tariffs will be slapped on imported steel that exceeds those average amounts. The steel safeguard measure will be in place for a maximum of 200 days, and will end by Feb. 4, 2018.
The EU’s decision comes as Korea’s steel industry faces increasing pressure, as the United States has already imposed quotas on Korean steel.
“The EU is the fourth-largest import market for Korean steel,” said Moon Seung-wook, head of the industry and enterprise innovation office at the Ministry of Trade, Industry and Energy, during the meeting with officials from 14 Korean steel companies held at the Korea Iron & Steel Association office in Seoul. “The EU’s 25 percent tariffs could be an obstacle in further expanding our exports in the future.”
According to the Korean government, last year Korea exported 3.3 million tons of steel worth $2.9 billion. Korea exported an average of 2.72 million tons of steel over the last three years. The types of steel exported to Europe are mostly high-value, including those used to build ships and automobiles, while most of the steel exported to the United States is in the form of pipes.
Moon said that this year is particularly difficult for the Korean steel industry, noting the recent agreement with the United States to limit Korean steel exports. Earlier this year, U.S. President Donald Trump announced that the United States would apply 25 percent tariffs on steel imports on national security grounds. However, Korea, through negotiations, was able to avoid the high tariffs. In March, Korea agreed to a quota on steel exports to the United States, limiting them to 70 percent of the average exports that Korean companies have sent to the U.S. over the past three years.
“It seems like a domino situation is happening, starting with the United States and now the EU,” Moon said. “Although it may not be an immediate burden, we are concerned over the difficulties [the Korean steel industries face], as we now have to find new markets.”
According to the Korea International Trade Association, overall Korean steel exports to the United States over the first five months of 2018 increased to $1.46 billion compared with the same period last year.
BY LEE HO-JEONG [email@example.com]
More in Economy
Hair salons do well during the pandemic
September economic uptick was a blip, statistics indicate
No more delays in shorter workweek, says labor minister
Better to give property than to receive a big tax bill