Washington, D.C. — The former U.S. President Donald Trump has signed off on the proposal to establish a collaboration with Japanese company Nippon Steel and United States Steel Corporation in a decision that could alter collaboration between the two countries in the steel industry, and could ease tensions between the two countries.
The agreement has been criticized by U.S. lawmakers over foreign ownership of strategic industries has received Trump’s approval as an “smart partnership” rather than an attempt to take over. Trump stated that the partnership would be beneficial to American workers and increase production in the industrial sector.
Trump: It’s a Partnership, Not a Takeover
At a rally, Trump said,
“This does not mean Japan dominating America This is an alliance. Nippon Steel is investing, creating jobs and ensuring that US Steel strong.”
His comments come during the time that the Committee on Foreign Investment in the United States (CFIUS) continues to review the merger to determine its security implications for the nation.
External Sources: Bloomberg – Trump is in favor of Nippon-US Steel’s deal
Political and Industrial Reactions
Although Trump’s remarks are intended to soothe political tensions, bipartisan criticism is still a strong point. Many senators have raised concerns regarding the influence of foreigners in key U.S. industries even when US Steel insists that Nippon Steel will be minor stakeholder and have no influence over assets of national security.
The unions have been cautious with a cautious welcome to investments, but insisting on the assurance of the security of jobs, wages and production quotas for domestic production.
External Sources: Reuters – Nippon Steel is facing US political opposition
What This Means for Global Steel Markets
If the deal is approved, Nippon Steel-US Steel agreement could lead to an global steel manufacturing alliance in the face of rising demand from around the world and an increase in concurrence from China. Experts believe the move will increase supply chain efficiency and decrease dependence on unreliable trade partners.
The agreement also signals an change in the direction of U.S. economic policy under increasing bipartisan recognition of the industrial cooperation between Asia and Pacific.
