[Congressional Record (Bound Edition), Volume 145 (1999), Part 4]
[Senate]
[Pages 6024-6025]
[From the U.S. Government Publishing Office, www.gpo.gov]




             ADMINISTRATION LETTER REGARDING STEEL IMPORTS

 Mr. MOYNIHAN. Mr. President, at the request of the 
Administration, I ask unanimous consent that a letter received today 
from Secretary of Commerce William M. Daley and U.S. Trade 
Representative Charlene Barshefsky be printed in the Record.
  The letter follows:

                                        Secretary of Commerce,

                                   Washington, DC, March 25, 1999.
     Hon. Daniel Patrick Moynihan,
     Ranking Member, Committee on Finance,
     U.S. Senate, Washington, DC.
       Dear Senator Moynihan: Following up on our testimony at 
     Tuesday's Senate Finance hearing on steel issues, we wanted 
     to apprise you of the most recent developments in our

[[Page 6025]]

     steel policy and the effect on the steel industry. The 
     President and the Vice President are deeply concerned about 
     the impact on our steelworkers, communities, and companies of 
     the recent surge in steel imports, and they are fully and 
     actively committed to effectively addressing it. They are 
     determined to maintain the United States' strong 
     manufacturing base and the good jobs it provides by ensuring 
     that our trading partners play by the rules governing 
     international trade.
       This Administration has implemented a comprehensive 
     strategy that combines full and timely enforcement of our 
     trade laws, expedited administrative action, and intensified 
     engagement with major foreign steel producing nations to 
     address unfair trade practices injuring our steel industry 
     and its workers.
       The import numbers for the past three months demonstrate 
     clearly that our strategy is producing results. The 
     preliminary data for February, released earlier today by the 
     Commerce Department, show that total steel imports in 
     February were 45 percent below November 1998 levels--and 
     reached the second lowest monthly level since April 1996. 
     Imports of hot-rolled steel have dropped 81 percent since 
     November. We will work to sustain the positive trends of the 
     past three months are sustained.
       Our strategy has focused on Japan, Russia, and Korea, which 
     together accounted for 80 percent of the surge in steel 
     imports last year. Through strong public and private 
     statements by the President and other senior Administration 
     officials, we have put Japan on notice that we expect its 
     imports to reach pre-crisis levels, or we stand ready to take 
     appropriate action under our trade laws, including self-
     initiation of trade cases. We have, in addition, negotiated 
     agreements with Russia that will reduce our overall steel 
     imports from Russia by almost 70 percent, and hot-rolled 
     steel imports from Russia by almost 90 percent this year. We 
     have sought firm commitments from Korea to ensure that its 
     steel industry is fully privatized and placed on a market 
     footing, including through the elimination of improper 
     subsidies.
       The declines in imports from these countries since November 
     have been dramatic. Hot-rolled exports from Russia fell from 
     over 600,000 metric tons in November to roughly ten tons in 
     February--a nearly 100 percent decline. Imports of hot-rolled 
     steel from Japan fell in that period from over 400,000 tons 
     to less than 5000 tons--a nearly 99 percent drop. Hot-rolled 
     imports from Korea dropped 35 percent since November, while 
     total steel imports from Korea are down 17 percent. And total 
     steel imports from Brazil, which, along with those from 
     Russia and Japan, are subject to an ongoing antidumping 
     investigation, have dropped 64 percent since November.
       The Department of Commerce has taken forceful steps to 
     eliminate dumping, including issuing critical circumstances 
     determinations only 45 days after initiating dumping 
     investigations on hot-rolled steel, a policy that could 
     result in retroactive application of dumping duties back to 
     last November. Last month, following an expedited 
     investigation, Commerce announced--a full month ahead of the 
     usual time schedule--preliminary determinations that 
     exporters in Japan, Russia and Brazil have dumped hot-rolled 
     steel into our market. The Commerce Department is currently 
     enforcing more than 100 antidumping and countervailing duty 
     orders and suspension agreements on steel products and is 
     currently conducting 45 new steel investigations.
       We will continue to closely monitor steel imports, and--in 
     an unprecedented new policy--have made preliminary steel 
     import statistics available to the public up to 25 days 
     earlier than under past practice. This will help the 
     Administration, industry, and workers identify and respond to 
     import trends more quickly.
       At the same time, last year's import surge demonstrated 
     that we need to look closely at our trade laws to ensure that 
     they deliver strong, effective relief in an expeditious 
     manner, while remaining consistent with our international 
     trade obligations. We believe the legislation introduced in 
     the House by Congressman Levin and Houghton constitutes a 
     constructive approach, and we stand ready to work with 
     Members of Congress to develop a bill we can recommend that 
     the President sign.
       In contrast, we strongly oppose legislation mandating 
     quotas because it would constitute a violation of our 
     international obligations under the World Trade Organization 
     (WTO) and would not be in our nation's economic interest. We 
     are the world's largest exporter, and our firms and workers 
     benefit tremendously from the international trading rules we 
     helped put into place. Quotas or other import restraints 
     imposed outside of WTO-consistent processes contained our 
     trade laws (such as through our ``section 201'' safeguards 
     law or antidumping and countervailing duty laws) violate our 
     international trade obligations. Such quotas or import 
     restraints would not be based on a determination of whether 
     the imports are causing or threatening serious injury, or 
     whether unfair trade or subsidization is involved, as 
     required by the WTO and our laws.
       Our current trade laws allow U.S. industry and workers to 
     seek such determinations, based upon which we can impose 
     quotas or other trade remedies consistent with our 
     international trade obligations. In addition, when the 
     procedures provided by our trade laws are followed, we can 
     take into account the full range of U.S. industry and worker 
     concerns and fashion remedies that do not result in 
     additional market distortions, import shortages, excessive 
     price hikes or retaliation that could harm U.S. export 
     industries and customers.
       This Administration firmly believes that the best way to 
     address unfair trade practices or import surges is through 
     vigorous and timely enforcement and use of strong U.S. trade 
     laws that are consistent with our international obligations, 
     and we and our colleagues stand ready to work with you to 
     ensure that objective is fully realized.
           Sincerely,
     William M. Daley,
       Secretary of Commerce.
     Charlene Barshefsky,
       U.S. Trade Representative.

                          ____________________