The confrontation between American and European steelmakers can be resolved through a negotiated agreement limiting foreign steel shipments to the United States, a European official said yesterday, warning that such a solution is necessary to avoid a trade war.
"In my view, the steel issue is the one to which the first priority must be given, because the longer a resolution of this problem is not found, the greater are the risks of counter-measures" by the Europeans, said Roland de Kergorlay, head of the delegation of the European Ecomonic Community commission in Washington.
The official said he is convinced that disagreements over the steel issue can be worked out despite the failure of U.S. Commerce Secretary Malcolm Baldrige's efforts last week to settle the conflict with the Europeans.
De Kergorlay was particularly critical of the Commerce Department's preliminary finding last month that European governments unfairly subsidized steel exports here, which required importers to post bonds on the imports. The administration took the action on complaints filed by seven of the nation's largest steelmakers after talks to settle the issue between the EEC, the U.S. steel industry and Baldrige broke down.
"Our disagreement on the steel trade issue I am convinced can be worked out," de Kergorlay said in a speech before the National Foreign Trade Council. "We have declared our intention not to retaliate at this stage because of our confidence in being able to work out our differences through mutually acceptable arrangements regarding the amount and nature of steel exports to the United States. Such an attitude is the necessary prerequisite for the avoidance of a trade war between Europe and America."
The decision "is a matter of grave concern to us," de Kergorlay said. "The result of this decision is that steel exports of a substantial value from certain E.C. member states will be virtually eliminated from the U.S. market."