FOR IMMEDIATE RELEASE  Contact: Christina Bucher
December 7, 2001   The PBN Company


Washington, DC - Consuming Industries Trade Action Coalition (CITAC) Chairman Jon Jenson said he is "disappointed but not surprised" after hearing International Trade Commissioners vote today for restrictions ranging from quotas to 40-percent tariffs in the Section 201 steel investigation.

"A lot of people are going to suffer if the President imposes massive import restraints. Competitive steel imports are vital to the health of U.S. manufacturers. That's a message that came through loud and clear during these hearings, not only from steel-consuming companies, but from a number of Members of Congress, port authorities, importers, our international trading partners and our allies against terrorism."

ITC Commissioners voted to recommend varying remedies, including 40-percent tariffs (two votes), 20-percent tariffs (three votes), and quotas (one vote) on flat-rolled steel products. Commissioners recommended a vast array of remedies for other products as well. These would be layered on top of standing antidumping and countervailing duty orders and could virtually halt the flow of necessary imports to U.S. producers.

By December 19 the Commissioners must send their detailed findings and recommendations to the President, who has a maximum of 75 days to implement ITC recommendations or craft his own remedy.

"Commissioners had a number of options from which to choose. We hoped they would have addressed the domestic integrated producers' problems without adversely impacting U.S. downstream manufacturers. They did not. We're counting on clearer heads to prevail in the presidential phase," continued Jenson.

"These recommendations proceed from the faulty premise that imports are the most serious cause of the industry's problems," said Lewis Leibowitz, Counsel to CITAC. "In reality, import restrictions will not solve the industry's problems because they stem from other causes, such as high legacy costs."

Senator Chuck Hagel (R-NE) testified during the remedy hearing that, "trade barriers do not address competitiveness problems. Barriers do not create incentives to restructure, consolidate, reform, and innovate." But barriers will "increase the likelihood of a prolonged economic recession through inflationary prices," and threaten the progress the U.S. has made in the course of 50 years of trade liberalization through the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO).

John C. Kennedy, President and CEO of Autocam Corporation of Grand Rapids, Michigan also testified to the ITC on the downstream impact of trade barriers. High tariffs on the steel Autocam uses could eliminate needed imports from the U.S. market. According to Kennedy, "Our market needs imports, or we steel-using manufacturers will lose our competitiveness."

In addition to the burden trade restrictions would create for steel consumers and their workers, many of the steel products that could be restricted are in short supply or unavailable in the U.S. CITAC will continue to fight for short supply provisions as well as for an end to layering of restrictions.

According to Jenson, "The global economy demands that we have competitive companies providing competitively priced goods. Artificial trade restraints make that impossible. In addition to serving as a crutch for noncompetitive producers, the restraints are going to harm manufacturers who are competing and providing jobs for 12.8 million Americans in the process."

CITAC is a coalition of companies and organizations committed to promoting a trade arena where U.S. consuming industries and their workers have access to global markets for imports that enhance the international competitiveness of U.S. firms.





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