Info Service on WTO and Trade Issues (Mar18/07)
12 March 2018
Third World Network
US under fire at General Council over proposed unilateral actions
Published in SUNS #8638 dated 9 March 2018
Geneva, 8 Mar (Kanaga Raja) - The United States once again came under
fire from many members of the World Trade Organisation (WTO), both
developed and developing, over its announced intention to impose steep
tariffs on imports of steel and aluminium purportedly on national
The criticisms of the US plans came at the formal meeting of the WTO's
General Council on Wednesday, when China, that had inscribed the item
of "Other Business" on the GC agenda, took the floor to
express its concerns.
The Chinese criticism was followed by 17 other WTO members who all
expressed strong concerns over the announced US intention to impose
steep tariffs on steel and aluminium under Section 232 of the Trade
Expansion Act of 1962.
On 5 March, at the informal Heads of Delegation (HOD) meeting of the
Trade Negotiations Committee (TNC), many members had voiced strong
concerns over the US move (see SUNS #8636 dated 7 march 2018).
Nearly every member that had spoken at that informal HOD/TNC meeting
had also expressed strong concerns over the impasse in the filling
of three current vacancies in the WTO's seven-member Appellate Body.
The United States has repeatedly blocked efforts to launch the selection
process to fill these vacancies on the Appellate Body.
At the formal General Council meeting on Wednesday, apart from China,
the other members who expressed concerns over the US intention to
impose tariffs on steel and aluminium were the European Union (comprising
28 member states), Canada, Chinese Taipei, Turkey, the Russian Federation,
Hong Kong-China, Australia, Norway, South Korea, Japan, Pakistan,
Switzerland, Mexico, Uganda, India, Brazil and Venezuela.
While the WTO members that spoke at the informal HOD/TNC meeting on
5 March did not name the United States in their interventions and
instead referred to it as "one member", at the formal General
Council meeting, however, China mentioned the United States by name,
as did the EU, Canada, Turkey, the Russian Federation, Norway, Japan,
Switzerland, Uganda and India.
According to trade officials, many members that spoke expressed both
commercial and systemic concerns over the US move. Many of them also
referred to the "elastic" use by the US of national security
exceptions, saying that these had consequences.
"Many said they feared tit-for-tat retaliation which could spiral
out of control, damaging the global economy and the multilateral trading
system," said WTO spokesman Keith Rockwell, at a media briefing
following the General Council meeting on Wednesday.
Asked how "we will know if we are in a trade war," Rockwell
said: "There is no clear definition of a trade war. But the Director-General
has made very clear he is concerned about the escalating nature of
this situation, and he is prevailing upon the membership to keep cool
heads and not let things spiral out of control."
The point is nothing has actually been implemented yet, he added.
Rockwell declined to comment when asked about President Donald Trump's
remarks about the WTO being "a catastrophe" (see separate
Asked what the WTO or the Secretariat in particular can do to prevent
a tit-for-tat trade retaliation, Rockwell said "use trade diplomacy
in every way possible. Reach out to all parties, continue to explain
to everyone the nature of the situation and the possible consequences
Rockwell said that the Director-General has clearly expressed his
concerns for the system.
Rockwell recalled two other times when a Director-General has done
this. One was in 2008 when the global financial crisis was underway
and the other was in 1998 when the Asian financial crisis was unfolding.
In each case the concern was systemic.
Rockwell also said that DG Azevedo has been reaching out to a great
number of members.
STRONG CONCERNS FROM MEMBERS
According to trade officials, China said that it has grave concerns
about the national security exception that the United States has cited
for the proposed tariffs on steel and aluminium. This will significantly
impact trade in steel and aluminium.
China also voiced systemic concerns, and said that the US investigation
was completely unilateral and it will undermine the rules-based multilateral
Pointing out that section 232 is a domestic law and not a WTO rule,
China said the United States had not carried out an investigation
in a transparent way, and it has already imposed more than 200 trade
remedies within the last year on steel and aluminium.
According to China, this over-protected domestic industry will never
be able to solve its problems through protectionism.
The EU expressed great concerns about the actions planned by the United
States. It said the information that has been made available suggests
that this will be made under the guise of national security.
This is a fundamental concern to the entire organisation, the EU emphasised,
adding that the response of other members to this action is not the
issue at this stage.
All members should comply with WTO agreements where there is ample
space to use various safeguard measures, and they can do this under
WTO rules in a legal and consistent manner.
The EU urged the United States to show restraint and to enter into
dialogue. The EU said it will consider all possible responses including
dispute settlement activity and WTO-consistent re-balancing measures.
Canada expressed very strong concerns about the planned safeguard
tariffs announced by the United States. It had both systemic and commercial
It is concerned about the suggestion of national security. It is certainly
inconceivable that Canadian exports could possibly be a threat to
US national security, it said.
Canada said that it is concerned about the impact of this action on
its own steel and aluminium industries.
With respect to the national security issue, Canada said, "We
fear that the United States may be opening a Pandora's Box that we
would not be able to close."
Chinese Taipei said that it has serious concerns about the national
security-based tariffs on steel and aluminium.
The toll is very high and we have to be very careful here. Any unjustifiable
action could lead to proliferation and tit-for-tat responses, it said.
Turkey also voiced similar concerns particularly with respect to the
national security based tariffs.
The Russian Federation urged the United States to abide by WTO rules,
while Hong Kong-China also expressed concerns.
Australia said that international trade rules must be upheld.
Norway expressed deep concern over the Section 232 process. It said
this represents a serious challenge to the multilateral trading system.
It urged the United States to re-consider.
Korea also expressed serious concerns over the US move. It said that
GATT Article XXI (on security exceptions) must be used in a measured
and strict manner.
Japan also shared the concerns over the unilateral actions taken by
the United States.
Pakistan said that this should be of major concern for developing
countries. They depend on the multilateral trading system and anything
which threatens that could foretell consequences for developing countries.
Switzerland also expressed concerns about the US action and the potential
consequences for the WTO.
Mexico said that no one benefits from going against the rules.
Uganda said although it did not export steel and aluminium to the
United States, there could be consequences for them. It will be affected
by this if the trading system is damaged. We must be very watchful,
According to trade officials, India also expressed its concerns. It
said that we must be careful not to misuse the national security exception
under the GATT.
Unilateral measures have no place in the multilateral trading system,
India pointed out.
Brazil said it has deep concerns about an elastic or broad application
of the national security exception.
Venezuela said it is joining the group that has expressed its concerns
particularly about the unilateral nature of the US actions.
According to trade officials, the United States did not take the floor
under this agenda item.
Meanwhile, also under Other Business, Canada said that it will be
hosting a workshop on trade and gender (one of the issues that failed
to garner multilateral consensus at the Buenos Aires Ministerial Conference)
on 16 March.
Under the agenda item of Report by the Chairman of the Trade Negotiations
Committee and Report by the Director-General, Burkina Faso, on behalf
of the Cotton-4 countries, said that it was disappointed with the
results at Buenos Aires.
According to trade officials, after 14 years, Burkina Faso said that
it had hoped to have had more progress with respect to the reductions
in trade distorting domestic support for cotton.
It called on WTO members to come up with proposals. It had also done
this at Buenos Aires, it said.
Burkina Faso said that it had called for sharp focus in terms of analysis
of the numbers and in terms of finding a solution.
It was disappointed that this did not give rise to constructive commitments
by members. It disappointed Ministers from the C-4 countries in that
they did not get a chance to negotiate outcomes.
The issue was basically taken off the table and was not even the subject
of negotiation, it said.
It expressed great frustration over this, saying that there will be
a meeting of the C-4 focusing on this issue on 9-12 April.
According to trade officials, DG Azevedo did not take the floor under
this agenda item. His statement at the informal HOD/TNC meeting on
5 March will be read into the record as well as the statements of
some 45 delegations at that same informal meeting.