Jul 15, 1992


BRUSSELS, JULY 13 (IPS/BOB MANTIRI) -- Trade disputes are putting a strain on relationships between the European Community and the United States on the one hand, and the EC and Japan on the other.

As far as the United States is concerned, the dispute follows a call by 12 big U.S. firms urging the George Bush administration to "impose levies on the import of heavily subsidised steel products from the seven European steel entrepreneurs".

The seven European exporters - German, Italy, France, Spain, Belgium and the Netherlands - have through the European Commission, charged that any such moves would "disrupt the normal trade system".

Currently, Europe annually exports two million tons of steel to the United States, which translates into about 800 million dollars of foreign exchange earnings.

EC Commissioner Frans Andriessen, who is directly responsible for trade policy, said he is anxious to discuss the issue "as soon as possible at the highest possible level in Washington".

But an U.S. embassy spokesperson said that Washington may not respond to this call until after the presidential elections in November.

Analysts say that the underlying issue of the steel wrangle is the ongoing agricultural subsidy dispute in the Uruguay Round of trade negotiations in the GATT.

The U.S. is demanding that the EC abolish all subsidies for agriculture and its related products. But the EC insists that having introduced drastic reforms to its Common Agricultural Policy (CAP), the ball is now in the court of the U.S.