U.S. President Joe Biden blocked Nippon Steel's deal to purchase US Steel, citing concerns over national security and supply chains. This decision has sparked criticism from both Japan and within the U.S.
Reasons for Biden's Rejection
Biden cited national security and supply chain concerns as his reasons for rejecting the Nippon Steel deal. However, some claim that the official reasons were not confirmed by the Committee on Foreign Investment in the United States, which found no security threat in this deal. It is suggested that the resistance came from the U.S. Trade Representative.
Japan's Reaction
Japan's Trade Minister Yoji Muto called Biden's decision 'incomprehensible.' Discussing the situation, Japan's Prime Minister Shigeru Ishiba stated: 'It's hard to fathom how an acquisition by a close ally could be considered a national security threat.'
Legal Consequences
Following the rejection of the deal, both Nippon Steel and US Steel filed a lawsuit against the U.S. government. Nippon Steel argues that it deserves a thorough review, while US Steel's President and CEO David Burritt called Biden's decision 'shameful and corrupt.' Nippon Steel is also required to pay a $56 million breakup fee.
The situation around the Nippon Steel deal highlights growing tensions between the U.S. and Japan, which could impact future trade relations between the countries.
