In a pivotal move signaling strong economic nationalism, U.S. President Joe Biden has officially blocked Nippon Steel's $14.9 billion bid to acquire U.S. Steel, driven by concerns that the deal could jeopardize national security. "U.S. Steel will remain a proud American company – one that’s American-owned, American-operated, by American union steelworkers – the best in the world," Biden stated.

This decision, which many anticipated, denies crucial financial support to U.S. Steel, which has warned it may need to idle key mills without the $3 billion in investment from Nippon Steel.

The proposed acquisition faced intense scrutiny during a review led by the Committee on Foreign Investment in the United States (CFIUS), which concluded by December 23 with a recommendation to block the deal due to unresolved national security risks. Both Biden and his eventual successor, Donald Trump, had voiced opposition to the merger throughout the campaign, particularly focusing on protecting American jobs in the steel industry.

This merger has been contentious since it was proposed, especially in light of a letter from CFIUS on August 31, highlighting potential risks to essential steel supplies needed for transportation, construction, and agricultural projects. Nonetheless, Nippon Steel attempted to alleviate concerns by suggesting relocating their U.S. headquarters to Pittsburgh and honoring agreements with local unions.

Despite efforts from Nippon Steel to gain approval, largely amidst hopes of a more favorable political environment post-election, CFIUS ultimately indicated a strong preference for Biden to block the acquisition in December. The rejection signifies a broader trend of increased vigilance regarding foreign investments in critical industries, amidst fears over supply chain vulnerabilities.

The decision is also set against recent diplomatic attempts between the U.S. and Japan, where officials like Japanese Prime Minister Shigeru Ishiba had previously urged for the deal's approval, hoping to reinforce bilateral ties that have been challenged by issues surrounding China's rising influence and North Korea's threats. Even as U.S. Steel warned that blocking the acquisition could jeopardize thousands of jobs, union representatives criticized the company’s claims as exaggerated.

Biden's commitment to safeguard national interests remains clear as he emphasized the importance of American ownership in sectors vital to national security, declaring, "I will never hesitate to act to protect the security of this nation and its infrastructure as well as the resilience of its supply chains."

For more details, refer to the full articles from VOA News and Reuters.