WASHINGTON - The World Trade Organization issued a final ruling Monday that the steel tariffs imposed by President Bush violate international trade rules, escalating the pressure on the president to repeal the tariffs.
The decision by the WTO gives the European Union, Japan, Brazil and other countries the right to impose retaliatory tariffs on a host of American exports unless Bush reverses the decision he made in March of last year to give American steel makers protection from imports. The EU has already said it is readying punitive duties that would be applied starting in mid-December on American motorcycles, citrus fruit and farm equipment, among other goods.
That leaves Bush with an unpleasant political choice. If he abides by the WTO ruling and rolls back the steel tariffs, he may anger voters in key steel making states such as Pennsylvania and West Virginia. But if he maintains the tariffs, he risks courting the wrath of industries in other states that would be hurt by the retaliatory duties -- including Florida's citrus industry.
Pressure to repeal the tariffs was already stiff. U.S. industries that use steel, such as appliance and auto makers, have been complaining that the higher steel prices brought about by the tariffs are eroding their profits amid a generally tough environment for American manufacturing.
The ruling by a WTO appeals panel affirmed an earlier finding by the Geneva-based body against the steel tariffs, which range up to 30 percent. When Bush first imposed the tariffs in March 2002, he said he was giving U.S. steel makers three years of protection to give them time to restructure, under a law that allows ''safeguard'' tariffs for industries facing a surge of imports. But the EU and seven other countries filed complaints asserting that the United States had failed to provide evidence of a recent surge in steel imports. The WTO -- the international body that adjudicates trade disputes among nations -- agreed.
Richard Mills, a spokesman for U.S. Trade Representative Robert Zoellick, said in a statement, ''We disagree with the overall Appellate Body findings,'' but he did not hint at how the administration would respond, saying only, ``We will be reviewing the WTO report carefully.''
The EU has said it would impose sanctions on more than $2 billion in U.S. imports, with tariffs ranging from 8 percent to 30 percent on top of existing duties.
The list of products targeted include several that were evidently chosen for their political impact.
Tariffs on citrus fruit, for example, risk alienating voters in the toss-up state of Florida where the president's brother, Jeb Bush, is the governor.
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