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Swiss join anti-US protests over steel tariffs

Swiss steel workers risk getting caught in the growing world-wide trade row Keystone Archive

Switzerland has expressed its "concern and disappointment" over the United States decision to impose 30 percent tariffs on steel imports.

This content was published on March 7, 2002 - 16:24

While the Swiss steel industry remains small by global standards, the government has criticised the US move and hinted at joining the European Union's push to take the growing trade row to the World Trade Organization.

Alain Kocher, a spokesman for the State Secretariat for Economic Affairs (Seco), told swissinfo the government was still assessing the impact of the tariffs on local steel producers - particularly those in small and medium enterprises.

"Switzerland and Seco are very concerned and disappointed by these penalising tariffs," he said.

"We feel that this is a clear violation of WTO rules and is not in line with global trade policy [in support of] open, competitive and deregulated markets."

WTO action

Kocher said the government was particularly concerned that the US tariffs were geared to penalise companies that produce high-grade and value-added steel products.

"The Swiss steel industry has very specialised products ... and concentrated market share. Therefore there might be quite a few smaller and medium-sized enterprises that are really hurt by these penalties," he said.

While Switzerland has yet to decide on retaliatory action, Kocher said one option could be to join the EU challenge in the world's trade courts.

"We are currently still studying these cases and are in close contact with Swiss companies that are affected, so I cannot say exactly what we will do. But it is possible that a WTO panel is called upon."

Industry braces

Switzerland's steel industry says it is bracing itself for a drop in world steel prices at a time when the industry has been recovering from several years of poor trading.

Arnold Huber, chief financial officer of the Swiss Steel Group, which represents the industry, said the tariffs would exacerbate an existing oversupply of steel in Europe and the Far East.

"We are a bit afraid that the oversupply that already exists today will be increased because the steel producers cannot export to the US anymore - and that may lead to price pressure in the whole steel market," he said. "That could hurt Swiss steel."

Small but solid

Switzerland's steel industry is only a fraction of the size of its rivals in Japan and Europe. It employs less than 1,300 workers and produces around one million tons per year - mainly for the building, machine and auto sectors.

Huber said the industry did not expect the impact of the tariffs to be felt in Switzerland immediately.

But talk of a potential trade war by European and Asian countries against the US has the Swiss industry worried.

"It [a trade war] is possible because Europe's steel industry is still an important industry today," Huber said.

"On the other hand I would be in favour of first taking steps to negotiate and then the legal steps via the World Trade Organization, because a trade war in the end hurts all parties involved," Huber said.

by Samantha Tonkin and Jacob Greber

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