Colombia has taken decisive action to protect its steel industry by raising tariffs on imports from countries without trade agreements, particularly China.The government recently issued a decree increasing the tariff on wire rod imports to 35%, the maximum allowed under World Trade Organization rules.This move responds to concerns from local steel producers about cheap imports threatening domestic jobs and industry viability.Colombian manufacturers report that Chinese steel shipments are priced up to 42% below market rates, creating unfair competition.The new tariff, up from the previous 5%, will remain in effect for two years.
It applies to countries without free trade agreements with Colombia, including China and Russia.Colombia Boosts Steel Tariffs to Shield Domestic Industry fm Chinese Imports.
(Photo Internet reproduction)Luis Carlos Reyes, Colombias Trade Minister, emphasized that the decision followed a thorough investigation.
The study revealed that imports from these countries were harming the national industry.Reyes stated, Our goal is to promote fair and equitable competition.
In the first half of 2024, steel imports from China and Russia increased by 75% compared to the latter half of 2023.Colombias Steel Industry Pushes for Tariff IncreasesFabio Galn, President of steel manufacturer PazdelRo, highlighted that unfair competition threatens jobs and the survival of Colombias 75-year-old steel industry.The tariff increase aligns Colombia with other Latin American countries that have taken similar measures.
Brazilian, Mexican, and Chilean governments have also raised tariffs on Chinese steel imports recently.Colombian steel producers argue that the tariff increase is necessary to protect local jobs and ensure high-quality domestic steel availability.The industry employs thousands of workers and supports numerous indirect jobs in the supply chain.
The Colombian Chamber of Construction has previously opposed steel import tariff increases.They argue that reduced imports could lead to higher prices and shortages in the housing sector.
The steel industry counters that the impact on housing costs would be minimal, estimating a price increase of less than 1% for new homes.The tariff increase is part of a broader package of measures aimed at protecting Colombias steel industry.
This package also includes import quotas for steel from Andean Community countries.It reflects a growing trend of trade protectionism in the region as countries balance free trade principles with domestic industry protection.