Washington: US President George W Bush yesterday (Dec 4, 2003) withdrew the steel tariffs, which had threatened to lead to a trade war with Europe and Japan.

In a proclamation ending the temporary steel safeguard measures he put in place in March 2002, Bush said, "Prior to that time, steel prices were at 20-year lows, and the US International Trade Commission found that a surge in imports to the US market was causing serious injury to our domestic steel industry.

"I took action to give the industry a chance to adjust to the surge in foreign imports and to give relief to the workers and communities that depend on steel for their jobs and livelihoods. These safeguard measures have now achieved their purpose, and as a result of changed economic circumstances it is time to lift them.

"The US steel industry wisely used the 21 months of breathing space we provided to consolidate and restructure.

"The industry made progress increasing productivity, lowering production costs, and making America more competitive with foreign steel producers.

"Steel producers and workers have negotiated new groundbreaking labour agreements that allow greater flexibility and increase job stability.

"My jobs and growth plan has also created more favourable economic conditions for the industry, and the improving economy will help further stimulate demand," he said.

Bush also said the US will continue steel import licensing and monitoring programme in order to respond to future import surges that could unfairly damage the industry.

"We will continue negotiations with our trading partners through the Organisation of Economic Cooperation and Development to establish new and stronger disciplines on subsidies that governments grant to their steel producers.

"We will continue to pursue economic policies that create the conditions for steel producers, steel consumers who rely on steel to produce goods ranging from refrigerators to auto parts – and other US manufacturers to succeed.

White House said the President's decision "was based on significant improvements in the US steel industry".

"President Bush believes that America's workers can compete with anyone in the world as long as the playing field is fair and level," it said in a release.

Enforcing US trade laws is an important part of the President's commitment to free trade, the release said.

PTI