China's Ansteel signs deal with U.S. steel mill

China's Anshan Iron and Steel Group Corp. (Ansteel) and Mississippi-based Steel Development Co. Wednesday clinched a deal in Beijing to establish a joint venture in the United States.

U.S. lawmakers had attempted to block the deal marking China's first investment in America's steel production industry.

Fifty-two U.S. congressmen wrote a letter to U.S. Treasury Secretary Timothy Geithner in August requesting Washington investigate the deal, claiming the proposed joint venture would threaten "American jobs" and "national security."

Under the joint venture operation agreement signed Wednesday, Ansteel will take a 14-percent stake in the venture based in Amory, Mississippi.

John Correnti, chairman and chief executive officer (CEO) of Steel Development, said construction of the steel bar plant, estimated to cost 168 million U.S. dollars, had begun.

Production was scheduled to start in the first quarter of 2012, he said.

He noted the U.S. lawmakers who opposed China's investment in the U.S. were mainly from steel production bases. They saw China's involvement in U.S. steel production as a threat to local jobs.

"The deal has got support from the U.S. government, and the joint venture will increase job opportunities and local tax revenue," he said.

The project would create 1,000 construction jobs and employ 150 workers when production started, he said.

Zhang Xiaogang, general manager of Ansteel, said the partners planned to continue cooperation to build four other "technologically advanced and environmentally friendly steel mills" if the first venture was a success.

"Ansteel will take a more important role in the future joint venture projects," he said.

The first deal was an important step in Ansteel's goal of maintaining its position among the world leaders in iron and steel production technology and environmental protection, he said.

Chinese and American economists attending the Second Summer Palace Dialogue between Chinese and American Economists in Beijing Wednesday welcomed the deal.

Danial B. Wright, former U.S. Treasury Department managing director for China, said tensions in U.S.-China trade relations were often triggered by the media. Chinese companies should communicate more with the U.S. people to win more support in business deals.

Fan Gang, an economist and member of the monetary policy committee of China's central bank, said the completion of the deal suggested America's investment environment was improving.
(Source:xinhua)