Brussels, 12/09/2002 (Agence Europe) - Around forty steel producing countries will conclude three days of high level discussions on Friday. Talks focused on sector subsidies, which the USA is largely in favour of banning. This new meeting at the OECD centre in Paris took place a few weeks before the deadline set by the Union for possible reprisals against US surcharges and replacing temporary safeguard measures by a definitive mechanism which could be toned down if Member States agree to amongst themselves.
Sources on Thursday in Brussels indicated that the Europeans, who "learned of the US proposal today…are ready to discuss it", just as they are prepared to discuss anything thing else that is on the negotiating table. It was also pointed out that the Union had already made a contribution to the debate last March, while the USA remain unshakeable and focused on the setting up of the safeguard measure that are aimed to block all foreign imports of steel. In the document presented in Paris with the hope that it could be ratified before the "steel" session in December, Washington puts claims that the subsidies deployed throughout the world over the course of the last half century are partly responsible for the difficulties currently experienced the US steel industry and therefore proposed that these subsidies to the steel industry are largely ended. The Americans also propose ending all obstacles to trade, tariffs and otherwise, as well as strictly monitor national competition rules "so that markets can fully operate". They intend to examine a series of practices that are not yet covered by any regulation, including public loans and other forms of funding for steel companies, as well as procedures for bankruptcy that too often allow these inefficient organisations to survive. There are, however, no measures on trade protectionism, which is multiplying throughout the world. Washington will leave negotiations that are currently in course, to the WTO claiming that the levying of punitive surcharges, once agreed, will act as a break on the banning of trade distortion practices (subsidies, dumping).
Meanwhile, the Union has plunged into a rather turbulent re-examination of safeguard mechanisms, which it temporarily introduced last March for six moths and which the USA attacked at Geneva. The reduction proposed by the European Commission, which will begin at the end of the month - deadline for the setting up of "definitive" measures (which will remain in force as long as the US surcharges) has provoked generalised resistance from Member States. Instead of the fifteen categories of products currently targeted, it proposes keeping just 7. Certain Member States are insisting on a more flexible approach, which targets around a dozen at risk products (United Kingdom, France, Germany, Italy, Spain, Luxembourg, Belgium, Greece and Portugal) indicated one source close to the discussions.