Prime Minister Junichiro Koizumi is likely to raise the Japan-U.S. steel trade dispute at a meeting with President George W. Bush in Canada later this month, government sources said Thursday.

While Koizumi, not wanting to damage friendly bilateral relations, is unlikely to explicitly criticize or express concern over U.S. steel import curbs, he is expected to express hope the two countries can achieve a positive outcome, the sources said.

Koizumi and Bush are scheduled to meet on the sidelines of a summit of the Group of Eight countries scheduled between June 26 and June 27 in Kananaskis, Alberta.

Koizumi and Bush last met in February, when the president visited Japan while on an Asian tour.

By raising the issue amid the international community’s growing concerns that the United States is leaning toward protectionism, Koizumi is seeking a concession from the U.S. side to resolve the steel row as early as possible, according to the sources.

The row flared up March 20 when the U.S. administration slapped so-called safeguard tariffs on an array of steel imports in a bid to resuscitate the struggling U.S. steel industry.

Japan, the European Union, China and five other nations have filed complaints with the World Trade Organization over the U.S. measure, which applies tariffs of up to 30 percent on 14 types of steel products.

The WTO decided Monday to set up a dispute-settlement panel to determine whether the U.S. steel import tariffs violate global trade rules.

The U.S. emergency tariffs have already led to protectionist trade moves elsewhere.

The EU and China have imposed temporary safeguard tariffs on some steel products as protection against an expected surge in imports in the wake of the U.S. move.

Japan plans to impose retaliatory tariffs on some U.S. goods beginning June 18.

However, Japan may postpone the tariffs while awaiting a decision on whether the U.S. will allow more Japanese steel items to be exempted from its steel import tariffs.

The U.S. on July 2 is slated to finalize the list of steel items to be excluded from the tariffs it imposed March 20.

Tokyo is considering the postponement partly because it does not want to intensify the bilateral disputes in the lead up to the Koizumi-Bush summit, the sources said. There is opposition within the government to Koizumi raising the issue at the summit, and thereby possibly angering the U.S.

The Bush administration has refrained from making tough demands on Tokyo in relation to economic issues.

The two countries have had no formal contact on the steel issue since Economy, Trade and Industry Minister Takeo Hiranuma and U.S. Trade Representative Robert Zoellick failed to narrow their differences on May 15. On May 17, Japan notified the WTO of its retaliation plan.

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