*

Japan, US must unite against China's cheap steel, says PM

hopeful Koizumi

*

US security panel reviews Nippon Steel's ( NISTF ) bid for U.S.

Steel,

decision by Sept. 23

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Koizumi and Takaichi defend steel deal, stress Japan-US

alliance

amid election

By Tim Kelly and Katya Golubkova

TOKYO, Sept 14 (Reuters) - Japan and the United States

should avoid confrontation about the steel industry and work

together amid competition from China, the world's top

steelmaker, leading prime ministerial candidate Shinjiro Koizumi

said on Saturday.

Sources told Reuters on Friday that a powerful U.S. national

security panel reviewing Nippon Steel's ( NISTF ) $14.9 billion

bid for U.S. Steel faces a Sept. 23 deadline to recommend

whether the White House should block the deal.

Koizumi, Japan's former environment minister, said at a

debate on Saturday that Japan and the U.S. should not confront

each other when it comes to the steel industry but to face

together the 'shared challenge' coming from China's steel

industry.

"If China, producing cheap steel without renewable or clean

energy, floods the global market, it will most adversely affect

us, the democratic countries playing by fair market rules,"

Koizumi said.

Nippon Steel's ( NISTF ) key negotiator on the deal, Vice Chairman

Takahiro Mori, said last month that his company and other

Japanese steelmakers were urging Tokyo to consider curbing cheap

steel imports coming from China to protect the local market.

On Sunday, Nippon Steel ( NISTF ) and U.S. Steel sent a letter to U.S.

President Joe Biden about their deal, as Biden, Democratic

presidential nominee Kamala Harris and Republican presidential

nominee Donald Trump have all opposed the merger.

"We are also in the midst of elections, just like the U.S.,

and during elections, various ideas may arise. Overreacting to

each of these would, in my view, call into question diplomatic

judgment," Koizumi said when asked about the deal.

Sanae Takaichi, Japan's minister in charge of economic

security and another prime ministerial candidate, also defended

the deal during the same debate attended by eight other Liberal

Democratic Party's (LDP) leadership contenders on Saturday.

"It appears they are using (the Committee on Foreign

Investment in the United States) CFIUS to frame this as an

economic security issue," she said.

"However, Japan and the U.S. are allies, and the steel

industry is about strengthening our combined resilience."

The 43-year-old son of former Prime Minister Junichiro

Koizumi, the junior Koizumi, is seen as a leading contender in

the Sept. 27 race to pick the LDP's new leader, who will become

the next prime minister due to the party's control of

parliament.

Koizumi said on Saturday that he would seek a dialogue with

the North Korean leadership to resolve the issue over the

abduction of Japanese citizens kidnapped by North Korean agents

in the 1970s and 1980s.

"We want to explore new opportunities for dialogue between

people of the same generation, without being bound by

conventional approaches, and without preconditions," Koizumi

said.

North Korean leader Kim Jong Un is 40 years old.

(Reporting by Tim Kelly and Katya Golubkova; Editing by

Muralikumar Anantharaman)