The Iraqi oil is more important that the American steel
The Russian government and their Western colleagues have been rejecting a certain economic motive in negotiations pertaining to the Iraqi issue. However, it is obvious that Vladimir Putin’s agreement with the new resolution of the United Nations definitely means something.
It deems that the USA has already made its first concession. As has became known, the US Committee for International Trade decided not to institute new anti-dumping tariffs on cold-rolled steel deliveries. Those tariffs will not be introduced for Russia and 14 other countries. Thus, the American market is now open again for the Russian metallurgic industry.
As the online newspaper Gazeta.Ru informed that the mentioned committee decided with four votes for and one vote against it. The Committee for International Trade is considered to be an absolutely independent arbitrary board that deals with trade disputes. The committee has recently finished the anti-dumping investigation concerning the delivery of steel from 20 countries of the world, including Russia. Suppliers from five countries were allowed to return to the American market in August of the current year.
The “steel war” between the United States and Russia started in March of this year. American President George Bush ventured to protect the American steel industry, which had already lost the competition with the import steel. Bush approved of the institution of prohibitive tariffs on the majority of steel that was delivered to the States. Russian metallurgic companies could have lost up to 1.5 billion dollars (in the future) a year because of that decision. Steel suppliers from Europe, China, and Japan suffered as well.
The European Union was especially conspicuous to lift American steel tariffs, and eventually forced the WTO to issue an official denouncement of America’s actions. Russia is not a WTO member, so it had to take some “inadequate” protective measures instead. Then, it started standing up for its interests during bilateral negotiations with the USA.
As soon as the USA raised the steel tariffs, the Russian Agricultural Ministry banned the importation of chicken legs – the so-called Bush’s legs, as they are ironically called by Russians. As it turned out, it was very bad news for American agricultural producers. America exported poultry to Russia from 38 states. Four of those states were about to experience the cessation of poultry production and mass unemployment because of Russia’s chicken ban. Russian Minister for Economic Development and Trade, German Gref, left for the USA to conduct negotiations. As a result, Russian companies concluded an agreement with Americans on September 23. Pursuant to that agreement, cold-rolled steel deliveries (this is the major constituent of the Russian steel export to the USA) were supposed to resume in April of the year 2003.
Now, after the latest decision from the Committee for International Trade, Russian metallurgical factories are free to start exporting their steel even now. However, Russian major steel exporters (Magnitogorsk, Severstal companies) do not rush to count their income.
As it became known, eight American metallurgical companies that actually launched the steel fight intend to appeal against the decision of the US committee for International Trade. There are no doubts that the final decision can be made only after Russia finds the correct solution of the Iraqi issue. The fact of the committee’s independence does not really matter in this respect.
On the other hand, American steel producers have something to fight for. Several American liberal economists keep saying that if it is not profitable to manufacture steel in America, then the steel production should be moved over to third countries. American steel factories should be simply closed.
This decision might cause huge political damage, against the background of the current industrial setback in the USA. However, excessive foreign ambition always lead to losses within a country. Iraqi oil is much more important for the USA at the moment than American steel.
Dmitry Slobodanuk PRAVDA.Ru
Translated by Dmitry Sudakov
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