The Ministry of Foreign Trade and Economic Co-operation (MOFTEC) said in a statement on Wednesday that the US decision "flouts WTO rules" and China retains the right to complain to the world trade club.

China's response followed on the heels of strong opposition against the US decision from the European Union (EU), Japan and South Korea, which said it would file an immediate complaint with the WTO.

The Bush administration on Tuesday slapped tariffs ranging from 8 to 30 per cent on steel imports from a slew of nations and regions, including Brazil, South Korea, Japan, Russia, Germany, Turkey, China, France, Australia and the Netherlands, to buoy its floundering domestic steel industry.

"China's small steel exports to the US are not sufficient to damage or threaten to harm US steel firms," the MOFTEC said.

The US decision would seriously affect Chinese steel firms' normal exports to the United States and cause them to incur undue losses, it said.

US Trade Representative Robert Zoellick said China will be one of the most affected countries as well as Japan, the EU and South Korea.

According to the State Economic and Trade Commission (SETC), China exported more than 6 million tons of steel last year, one-tenth of which were to the US market.

The MOFTEC reaffirmed it would continue to actively negotiate with the United States on the issue.

A spokesperson from the China Iron and Steel Association told China Daily that the organization, which consists of major Chinese steel makers, "is keeping a close tab on developments over the issue and is studying countermeasures."

Jiang Yuan, an official from the SETC said on Wednesday that the US steel import restrictions would trigger "very negative chain reactions" in China's steel market.

"Steel makers from the EU, Japan and South Korea are likely to more strongly target China, one of the world's biggest steel markets, bringing much pressure onto Chinese firms," Jiang said.

Chinese firms have already suffered from a glut of steel on the domestic market.

Jiang said China's exports to the EU, Southeast Asia and South America would be squeezed amid increasing competition in these markets as a result of the US restrictions.

The nations affected by the US restrictions would perhaps protect their own markets, thus adding difficulties on China's steel exports, she said.

(China Daily March 7, 2002)