Biden set to voice concern over proposed Japanese purchase of U.S. Steel

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President Biden is preparing to issue a statement of veiled opposition to Nippon Steel’s proposed acquisition of U.S. Steel before Japanese Prime Minister Fumio Kishida arrives in Washington for a planned state visit on April 10, according to three people familiar with the matter.

White House lawyers are drafting the expression of presidential concern even as the Committee on Foreign Investment in the United States reviews the proposed takeover.

Word of the president’s plans follows a meeting last week between Nippon Steel executives and representatives of the United Steelworkers Union, which has publicly opposed the $14.9 billion deal. Prominent lawmakers in both parties also have objected to the purchase by a foreign buyer of a once-iconic American industrial power.

In January, former president Donald Trump, Biden’s likely opponent in November, said of the deal that he would “block it instantaneously” if returned to the White House.

Administration officials have informed the Japanese government of the president’s plans, explaining the statement in terms of the president’s need to retain political support in Pennsylvania in the November election, said one industry source who described the matter on the condition of anonymity.

The president’s plans to issue a statement were first reported by The Financial Times.

In December, Lael Brainard, director of the National Economic Council, said Nippon Steel’s bid for the American company deserved “serious scrutiny.”

Controversy over the Nippon Steel proposal also illustrates tension at the heart of Biden’s international economic policy. In August, the White House celebrated an increase in foreign investment in U.S. factories. But Nippon Steel’s intention to do the same has stirred presidential unease largely because of domestic political factors.

The steel industry has traditionally been one of the most protected U.S. markets. In 2018, President Donald Trump imposed 25 percent tariffs on imported steel. Biden later agreed with the European Union to replace tariffs on European steel with import quotas.

U.S. Steel’s name holds a special place in the nation’s economic history. The company was the nation’s first billion-dollar corporation after its founding in 1901 through a merger of steel companies led by legendary business executives, including John D. Rockefeller.

The output of its blast furnaces formed the tanks, planes and aircraft carriers that helped win World War II, as well as the automobiles and appliances that consumers purchased during the postwar boom.

U.S. Steel today is just the third-largest steelmaker in the nation by revenue, behind Cleveland-Cliffs and Nucor, and it employs fewer than half as many workers as it did 20 years ago. The company lost money in nine of the last 15 years.

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