The government will take measures to block the import of unfair steel products to protect the domestic steel industry. The government plans to prevent actions that evade anti-dumping tariffs through third countries while establishing an early detection system for unfair imports and will intensively crack down on illegally distributed imported products. Concerns are growing that low-priced products from overseas, which have been blocked from export, may be entering the domestic market in abnormal ways due to the strengthening of protectionist policies by major countries such as the United States and the European Union.
A meeting of government officials regarding national policy issues, chaired by Acting President and Minister of Economy and Finance Choi Sang-mok, was held on March 19. The meeting discussed a plan titled ‘Countermeasures against trade risks and unfair imports in steel and aluminum.’ The plan includes measures for ▲ responding to trade issues ▲ supporting corporations in overcoming short-term crises ▲ blocking the domestic influx of unfair steel imports ▲ advancing the steel industry.
◇ Preventing circumventive dumping and establishing an early monitoring system for unfair imports
The Ministry of Trade, Industry and Energy, the Ministry of Economy and Finance, and the Korea Customs Service will amend tariff regulations to address various types of circumventive dumping actions. According to current tariff regulations, the target of circumventive dumping only includes actions that evade anti-dumping tariffs through minor changes within the supplying country. The government plans to revise tariff regulations to include 'circumventive dumping via third countries' as well, in order to prevent tactics that slightly alter product codes of items already subjected to anti-dumping tariffs to re-enter the domestic market through third countries.
The government will also establish a system for early detection of unfair imports. The government plans to require the submission of quality inspection certificates when importing steel products by amending the ‘Enforcement Decree of the External Trade Act.’ The quality inspection certificate contains more detailed information on product specifications and origin compared to the existing certificates of origin, allowing for a more accurate understanding of the status of steel products entering and distributing in the domestic market. The government expects that through the amendment of the enforcement decree, it will be able to more effectively respond to concerns about low-quality steel products or unfair practices such as circumventive dumping.
The government will also concentrate on cracking down on illegally distributed imported products. It will monitor activities that disguise imported products as domestic ones or export them, which violate the 'External Trade Act.' The Korea Customs Service plans to form a dedicated team of 56 members by the end of April to intensify crackdowns. Additionally, imports that have been frequently found to violate origin rules will be added to the target for distribution history management, and the frequency of inspections at distribution stages will be increased from twice a year to four times a year.
The government plans to rigorously conduct anti-dumping investigations on hot-rolled steel and plates currently underway, following established procedures and criteria. It also intends to enhance investigative capabilities by expanding the organization of the Trade Commission to strengthen overall trade defense functions.
◇ Responding to trade barriers from major countries through bilateral and multilateral negotiations
The government will actively engage in intergovernmental consultations through various paths, including bilateral and multilateral discussions at high and working levels, to respond to trade barriers from major countries. It plans to closely address the U.S. government's application of a 25% tariff on steel and aluminum, as well as safeguard investigations on flat products by India, the implementation of the EU's carbon border adjustment mechanism, and the review of strengthened safeguards.
The government has also designated the 'Tariff Response 119' established at KOTRA as a unified portal to support corporations in overcoming trade barriers in steel, aluminum, and derivative products. Tariff Response 119 will listen to the difficulties of corporations and then connect them to domestic and international support programs from related organizations such as the Korea International Trade Association, the Korea Chamber of Commerce and Industry (KORCHAM), and KOTRA. The Ministry of Industry is currently operating a 'U.S. Tariff Help Desk' and is planning to designate a 'Steel Hub Trade Office' next month to support damage analysis and recovery and the exploration of alternative markets. In the third quarter, it will start building a ‘technical barriers to trade (TBT) local response hub.’
The Ministry of Small and Medium Enterprises and Startups will conduct an emergency survey targeting small and medium enterprises affected by tariffs in March. The results of the survey will be used in the process of establishing government support policies by various ministries.
◇ Focus on new markets such as low-carbon and high-value steel products
The Ministry of Industry is discussing the long-term development direction of the steel industry in conjunction with academia and research institutions through the 'Public-Private Joint Task Force for Enhancing the Competitiveness of the Steel Industry' launched in January this year. In response to global oversupply, it has been decided to concentrate on new markets such as low-carbon and high-value steel products instead of competing on price or volume.
To this end, the government will establish low-carbon steel standards considering domestic conditions and develop stable demand creation plans together with related ministries. It will also promote the establishment of a foundation suitable for new markets in research and development, manpower, and raw materials (scrap metal).
The government aims to implement the plan swiftly while responding quickly to the crisis in the steel industry. It also plans to prepare a 'Steel Industry Advancement Plan' containing the future blueprint for the steel industry by the end of this year.