• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

Japan to Put Retaliatory Levies on U.S. Ball Bearing, Steel Products

Posted on: Monday, 1 August 2005, 12:01 CDT

Aug. 1--TOKYO -- Japan decided Monday to invoke countervailing import tariffs on U.S. ball bearing and steel products from Sept. 1, in response to a U.S. antidumping law which the World Trade Organization has decided violates global rules, government officials said.

In the first such measure Japan has ever taken against any trading partner, it will slap a 15 percent levy on 15 product items from the United States, including seven types of ball bearings and three types of steel products, they said.

The Economy, Trade and Industry Ministry issued a statement by trade minister Shoichi Nakagawa, saying, "Although we have repeatedly asked the United States to abolish the law, the Congress has not discussed the bill yet, and possibilities are very low for the legislation to be scrapped within this fiscal year (through September)."

"We confirmed the need to put additional pressure on the U.S. Congress and strongly hope that Washington will take Japan's decision seriously and scrap the Byrd Amendment immediately," he said.

Vice Economy, Trade and Industry Minister Hideji Sugiyama said in a press conference the retaliatory step to be taken by Japan is unlikely to immediately affect Japan-U.S. ties because Tokyo will implement the measure sanctioned by the WTO and the U.S. government recognizes the need to scrap it.

The levies will be in place as long as Washington maintains the 2000 law. The Japanese government will review the items covered and tariff rates every year, the officials said.

The retaliatory measure will effectively reduce the value of Japanese imports of the 15 U.S. products, also including a type of forklift truck and a type of printer, by about 5.6 billion yen, they said.

Of the 15 products, 14 are currently imported duty free, while a 3.5 percent tariff is imposed on the remaining one, which is a type of belting for transmissions or conveyers, the officials said.

In 2004, imports of the 15 items to Japan totaled 13.31 billion yen with the seven bearings items accounting for 10.32 billion yen and three steel products standing at 830 million yen, they said.

The government decided on the policy of taking the countervailing step after the Finance Ministry's advisory panel, Council on Customs, Tariff, Foreign Exchange and Other Transactions, approved the plan Monday morning.

To invoke the countervailing import tariffs, the government will ready a new ordinance. The retaliatory measure needs to be approved at a Cabinet ministers' meeting, they said.

The U.S. law, known as the Byrd Amendment, allows antidumping duties collected by the U.S. government to be shared with domestic industries to help offset damage from cheap imports.

The WTO ruled in January 2003 that the U.S. legislation violates world trade rules, after complaints were filed by 11 economies including Japan, the European Union and Canada, and urged the country to repeal the law by December that year.

Since the Untied States failed to comply with the WTO recommendation before the deadline, the multilateral trade body gave approval last November for Japan, the European Union, Canada, South Korea, Mexico, Brazil, India and Chile to take retaliatory measures.

The WTO then said Japan can impose countervailing levies worth about $52.1 million, or some 5.7 billion yen, on U.S. products.

Of the eight economies, the European Union and Canada invoked the countervailing import tariffs in May. In June, Japan, together with other economies, told the United States to scrap the 2000 law by the end of July or face higher tariffs on U.S. products.

Economists and analysts expect the countervailing measure to have a limited impact on Japan-U.S. trade because the size of the levies is relatively small.

But it will increase international pressure on Washington to remove the law, they said.

U.S. President George W. Bush has signaled willingness to review the law, but Congress has been reluctant.

-----

To see more of Kyodo News International, go to http://www.kyodonews.com

Copyright (c) 2005, Kyodo News International, Tokyo

Distributed by Knight Ridder/Tribune Business News.

For information on republishing this content, contact us at (800) 661-2511 (U.S.), (213) 237-4914 (worldwide), fax (213) 237-6515, or e-mail reprints@krtinfo.com.

Source: Kyodo News International, Tokyo

More News in this Category