A few days before Donald Trump returns to the White House, the Biden Administration is working around the clock to tie up the loose ends of his legislature. One of them is to guarantee American ownership in important companies in the domestic productive fabric, especially in the steel sector. For this reason, the Democrat opposed from the beginning the acquisition of US Steel by the Japanese firm Nippon Steela position shared with Donald Trump. Finally, and despite the fact that the management and workers of the American company asked that the operation be carried out, Washington has shelved the matter, justifying its decision in the protection of its supply chain and national security.
In a statement published this Friday by the White House, President Joe Biden has confirmed the veto of US Steel’s purchase offer for Nippon Steel valued at 15 billion dollars. Specifically, the still US president has issued an order for both firms to “completely and permanently abandon the proposed transaction” within a period of 30 days. According to Biden, this operation would place “American steel producers under foreign control, putting national security and critical supply chains at risk.”
Biden has gone so far as to assure in the order that they exist “credible evidence“that, by purchasing, the Japanese firm “can take actions that threaten harm US national security“, although without approving concrete evidence. The White House’s move could damage relations with one of its main allies on the Asian continent, at a time when Washington and Tokyo are needed to contain China, a country that has expansive aspirations. in the South China Sea.
On the other hand, and although this is an example of the protectionist turn that the United States has taken, it is not the first time that Washington bends Tokyo’s arm. In the 1980s, Reagan managed to get Japan to reduce “voluntarily“vehicle exports to the US that were increasing Japan’s share in the US market. In fact, in 1982 the Plaza Accord was signed through which the yen appreciated 32% against the dollar, which affected Japanese exports. This caused numerous Japanese automobile companies to settle in the United States with the aim of producing there.
Thus, Biden’s veto has caused US Steel to fall on the stock market: the firm recorded declines of more than 7% in the early stages of the session.
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