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Economy

US lawmakers urge probe of Chinese steel investment

(Agencies)
Updated: 2010-07-03 13:25
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WASHINGTON - A bipartisan group of 50 US lawmakers called on Friday for an investigation into whether a Chinese investment in the US steel sector should be blocked on national security grounds.

The Congressional Steel Caucus, in a letter to Treasury Secretary Timothy Geithner, said it was "deeply concerned" the recently announced joint venture between Anshan Iron and Steel Group's and the Steel Development Co also threatened American jobs. [Ansteel plans to build JV in US]

The Chinese State-owned firm, also known as Angang, plans to invest in a $175 million rebar facility that Steel Development is building in Amory, Mississippi.

Rebar is a reinforcing steel bar commonly used in concrete and masonry structures.

The move comes at a time when US steel companies have complained loudly about unfair competition from China and have won a number of US anti-dumping and countervailing duties on Chinese steel goods. [US trade panel denies China steel product duties ]

It also follows a high-level pledge by Geithner and senior Chinese officials in late May that the United States and China would remain open to each other's investments.

"Anshan is China's fourth-largest steel producer," the lawmakers said in their letter. "We are deeply concerned that their direct investment in an American steel company threatens American jobs and our national security."

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The Treasury Department chairs the Committee on Foreign Investment in the United States, an interagency panel that can recommend the president block foreign investment on national security grounds.

A Treasury Department spokeswoman confirmed the lawmakers' letter had been received but made no additional comment, as is typical in CFIUS cases.

Officials at Steel Development could not be reached immediately for comment.

The United States blocks few foreign investments.

But last year, a Chinese mining company backed out of a deal to invest in a Nevada gold mine after the CFIUS review raised security concerns. The mine was about 60 miles from a base the US Navy uses to train its pilots.

China National Offshore Oil Corp withdrew its bid to buy Unocal Oil Co in 2005 after many US lawmakers objected on national security grounds.

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