EU steelmakers to lobby for extension of current safeguard beyond expiry

Thursday, 15 October 2020 15:27:33 (GMT+3)   |   Istanbul

The European Steel Association (EUROFER) will do everything to ensure that the European Commission extends the EU safeguard on steel imports beyond its expiration date (June 30, 2021) - this is the rumor that has been circulating for several days now, especially after the news that, according to EU Trade Commissioner Valdis Dombrovskis, the extension of the current measures "could expose the bloc to heavy retaliation by trading partners."

The WTO rules allow for the application of safeguard measures for a period of up to eight years. In June 2021, the EU safeguard will have been active for just three years. However, if it were confirmed beyond the third year, the countries affected by the measures would be able to counterattack in the absence of compensation. It is precisely because of possible retaliation - from countries such as Turkey, Russia and China, but not only - that the EU is instead considering alternative defense measures.

European steel producers believe that an increase in low-cost imports, in a market already tried by the crisis caused by the pandemic, would be worse than any retaliation. Yesterday, October 14, during a press conference that preceded the annual meeting of the Italian steel producers’ association Federacciai, president Alessandro Banzato and general director Flavio Bregant said that countries like "China, India and Turkey are continuing to produce more," and as safeguards will be in place in both the US and the UK, "trade distortions will continue to exist." The Italian steelmakers' association is of the opinion that trade defense tools such as anti-dumping and anti-subsidy duties are not very effective and that, therefore, the safeguard should be maintained.

According to international trade lawyers, it could take more than a year for new trade defense measures to be applied, not to mention that the anti-dumping and anti-subsidy measures only concern imports from certain countries, while the safeguard affects all imports, regardless of their origin. Based on these considerations, EUROFER and the steel associations of the individual EU countries in the coming months will strongly ask the European Commission to launch a sunset review of the current safeguard, sources told SteelOrbis.

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