a “regrettable” decision indicates a government source to euronews


This article was originally published in English

A Japanese government source told Euronews that the Biden administration’s decision to block the takeover of US Steel by Japanese group Nippon Steel could impact future investments between Japan and the United States.

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While the inauguration of Donald Trump leaves a new wind of protectionism hovering over the planet, the outgoing president, Joe Biden, surprised the business world this Friday by controversially blocking the proposed acquisition of the company US Steel , based in Pittsburgh, by the Japanese company Nippon Steel.

However, the deal was sealed: the acquisition, for an amount of nearly $15 billion, had been accepted by the president during his pre-electoral campaign.

To justify this change of heart, Joe Biden indicated: “We need major American companies representing the majority of America’s steel capacity to continue to lead the fight on behalf of America’s national interests”he said in a press release.

A source within the Japanese government exclusively told Euronews that “this acquisition was an effort for Japanese and American steel companies to combine advanced technologies and increase competitiveness” and that this alliance aimed to “help maintain steel production capacity and employment in the United States.”

The source also referred to the increasing trend of investment from Japan to the United States, as well as “deep concerns” expressed by the business communities of both countries, particularly the Japanese industrial sector, regarding future investments between Japan and the United States.

“It is regrettable that this decision was taken for reasons of national security”added the government source, imploring the US government to work with its partner to resolve the problems.

Outraged reaction from Nippon Steel and US Steel

Both Nippon Steel and US Steel condemned the decision, issuing a joint statement saying Mr Biden’s decision “represents a clear violation of due process and the law and that the process was “manipulated” to serve its political agenda.

The joint statement from the two companies also emphasizes that Mr. Biden did not cite no credible evidence that the deal posed a national security concern and hinted at legal action, stating that “We have no choice but to take all appropriate measures to protect our legal rights.”

Mr. Biden’s decision comes after the Committee on Foreign Investment in the United States (CFIUS) failed to reach consensus on the possible national security risks of the operation last month, and sent Mr. Biden a long-awaited report on the merger. The latter had 15 days to make a final decision.

In their statement, the two steel companies said it was “shocking – and deeply disturbing” that the United States rejects a transaction that serves American interests and “treat an ally like Japan in this way.”

“Unfortunately, this sends a chilling message to any company based in a U.S. ally that is considering making a significant investment in the United States.”the companies said.

A number of conservatives and business groups such as the American Chamber of Commerce had publicly supported the deal, as Nippon Steel began to gain the trust of some metalworkers’ union members and mayors in areas near its blast furnaces.

According to figures from the World Steel Association, Nippon Steel was the world’s fourth largest steelmaker in 2023. US Steel was in 24th place.

Additional sources • AP

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