European Commission suggests steps to safeguard steel industry against cheap imports

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The European Commission suggested policy measures to support the continent’s steel sector ravaged by cheap imports from China, saying joint effort was needed to overcome challenges fuelled by global overcapacity, a dramatic increase of exports and an unprecedented wave of unfair trading practices.

“We must do more to help the steel sector and other energy-intensive industries adapt, innovate and compete on the basis of quality, cutting-edge technology, efficient production and a highly skilled workforce,” said Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness.

Katainen said the EU had a record level of anti-dumping measures on steel products in place and the Commission is determined to restore a global level playing field. “We will take steps to further streamline our procedures but Member States must also act together and urgently adopt our legislative proposal to modernise EU trade defence instruments and make fairer trade a reality,” the official added.

The Commission announced new short-term measures that will strengthen the EU’s defence against unfair trade practices, as well as longer-term action to guarantee the long-term competitiveness and sustainability of energy-intensive industries like steel.

Reminding stakeholders that it was already imposing a record number of measures to offset the detrimental effect of dumping, with 37 anti-dumping and anti-subsidy measures in place on steel products (16 of which on steel imports from China), the Commission said it will further accelerate the adoption of anti-dumping measures and stands ready to make additional proposals to speed up the overall procedure and improve the efficiency of the current system.

The Commission will also propose a prior surveillance system on steel products, a meaure that is already a part of the EU’s existing safeguard instrument. It can be introduced when import trends threaten to cause injury to European Union producers.

The Commission said energy-intensive industries could use various EU-level funds to support the modernisation of the beleaguered steel industry.

These include the €315 billion European Fund for Strategic Investments.

The steel industry in Europe is world-leading in certain steel product segments, represents 1.3 percent of EU GDP and provided around 328,000 jobs in 2015. The steel industry is also an important source of indirect employment, since it plays a significant role for many other industrial sectors such as the automotive industry.

Despite the potential of the European steel sector and the significant efforts made to innovate and modernise, its competitive position on the global steel market has deteriorated in recent years. Excess production of steel in third countries such as China has increased exports, depressed prices, and given rise to an unprecedented wave of unfair trading practices, distorting the global level playing field.

The current challenges for the steel industry are serious, but they can be overcome if all players work together in a spirit of sincere cooperation, the Commission said, adding it will continue to monitor the situation closely and put forward additional measures, as necessary.

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