The Chinese State Steel Group is the world’s largest steel producer, second only to the United States. It is said that China will surpass the US in steel production in the next two years. The Chinese government has been very supportive of Mt. Submittal and its downstream projects.
China is said to be reaping the benefits of setting up a local steel production facility in Bangladesh nha container. The move is expected to bolster the Chinese position vis-a-vis European Union and US. China’s move into Bangladesh is seen as strategic as it expands its sphere of influence. Moreover, the lifting of the ban on Mt. Submittal by the Government of Bangladesh is viewed as an important step towards opening up trade routes for the imported goods from China.
China is keen on establishing itself as a world leader in the arena of global crude steel production. The Government of India has approved the construction of the twin head mills at Bhakra and Singar. The project will help both the countries in promoting their respective steel industries. The Chinese are increasingly becoming a strong competitor of the European Union in all areas including renewable energy, metal prices and transport.
The United States is yet to respond to Chinese efforts to promote infrastructure across the border. However, the US is gearing up for a possible trade war with China. The US President, Mr. Donald Trump, has been very vocal about wanting to renegotiate the North American Free Trade Agreement (NAFTA). The present United States-led Free Trade Agreement with the EU has become a compromise agreement that contains the ‘disciplines of both’ the US and EU. However, it does not contain the necessary provisions to protect US producers from unfair Chinese competition. The fear is that the European Union will use the negotiation table to impose tougher tariffs on China and other Asian nations like Japan and India.
There is also a big concern in the United States for the future of the environment. The European Union is a major force in global environmental governance. If the EU insists on restricting US steel production, the US will be forced to re-evaluate its commitments to the World Trade Organization. The European Union had made strong moves in the past to press the issue of climate change. Steel producers in the United States could be badly affected if the European Union insists on forcing the matter.
The political rhetoric coming out of Washington does not inspire confidence in the US steel industry. A recent report by the Union of Concerned Scientists highlights, “The US is lagging behind other developed countries when it comes to implementation of climate change policies”. This is especially true when it comes to the global steel industry. For all the talk about the importance of the global steel industry to national economic security, the US is lagging behind in its efforts to create clean coal technology and pursue other renewable energy targets. It is ironic that the United States is one of the biggest promoters of clean energy technologies and yet seems unable to protect the most important sector of our national economy.