The meaning of section 232 of the Trade Extension Code

The US Department of Commerce proposed to President Trump that the steel industry would include in the 12 countries that would levy a 53 % tariff on Korean steel products in the 232-page Steel Trade Survey, which was published on Tuesday. This provision imposes a high rate of tariffs on the grounds that there is a threat of damaging national security, and it is unlikely that steel exports will suffer in Korea.

The Commerce Department, however, did not include traditional ally countries such as Canada, Japan and Germany among the 12 countries that export steel to the United States.

In fact, there are complaints about whether or not Korea has tied Korea to a trade war aimed at China.

Meanwhile, according to a US Department of Commerce`s Trade Extension Code Article 232, it is concluded that the decline of the US steel industry due to excessive steel imports will weaken the US economy and threaten national security. The Commerce Department said it would need a healthy and competitive US steel industry to produce the steel needed to maintain national defense facilities as well as the national core infrastructure. In order to compete in the steel industry, the average utilization rate of 74%.

The Commerce Department reported that if the steel imports were reduced by 37% from 2017, the utilization rate of the US steel industry could be increased to more than 80%.

The Commerce Department, on the other hand, first proposed setting quotas to limit all countries` steel imports to 63 % of the level in 2017, or a uniform 24 % tariff on all steel products.

Besides, 53% of the steel imports from 12 countries including Brazil, China, Costa Rica, Egypt, India, Malaysia, Korea, Russia, South Africa, Thailand, Turkey and Vietnam will be subject to high tariffs. . The Commerce Department did not specify the selection criteria for the 12 countries.

In the case of Canada, the United States is the top exporting country of the steel mill in the United States. However, it is not included in 12 countries. Excluding neighboring countries such as Mexico and Japan, Germany, Taiwan and the UK. An official from the Ministry of Commerce, Industry and Energy said, "We are analyzing the cause, but it seems to include countries that import a lot of Chinese steel because it has a lot of exports to the United States."

It has been analyzed that the reason that the purpose of section 232 investigation is aimed at China is included in the import regulation as the country which contributes to the low price export of Chinese steel industry. The actual report pointed to China`s chronic global steel oversupply as a cause of weakening the US economy and analyzed that steel imports would not decline unless this issue is resolved.

US steelmakers are likely to have influenced the Commerce Department`s conclusion that the Korean steelmakers insisted that Korean steelmakers cut steel plates from China into steel pipes and dumped them into the US during the investigation. President Trump will decide which of the three import duties proposed by the Department of Commerce by April 11.

The Korean government, on February 17, held a joint public-private joint-venture meeting at the Korea Technology Center under the auspices of Baek Woon-kyu, the minister of industry and industry, and will continue to persuade the US government, the parliament, and the industry until a final decision is reached by the US government.

By Park Jung Il comja77@


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