China says EU du­ties on Chi­nese steel are un­fair

Kuwait Times - - BUSINESS -

China’s Com­merce Min­istry has ex­pressed con­cern and re­gret af­ter the Euro­pean Union set pro­vi­sional im­port du­ties on two types of Chi­nese steel com­ing into the bloc, call­ing its in­ves­ti­ga­tion meth­ods “un­fair”. The du­ties an­nounced on Fri­day are the lat­est in a line of trade de­fenses set up against Chi­nese steel im­ports over the past two years to counter what EU steel pro­duc­ers say is a flood of steel sold at a loss due to Chi­nese over­ca­pac­ity.

Some 5,000 jobs have been axed in the Bri­tish steel in­dus­try in the past year as it strug­gles to com­pete with cheap Chi­nese im­ports and high en­ergy costs. G20 gov­ern­ments rec­og­nized last month that steel over­ca­pac­ity was a se­ri­ous prob­lem. China, the source of 50 per­cent of the world’s steel and the largest steel con­sumer, has said the prob­lem is a global one.

The sub­sti­tute coun­try in­ves­ti­ga­tion method used by the EU, a prac­tice typ­i­cally re­served for coun­tries deemed non-mar­ket economies, are “un­fair and un­rea­son­able” and “se­ri­ously dam­age the in­ter­ests of Chi­nese en­ter­prises,” the Com­merce Min­istry said in a state­ment posted to its web­site late on Satur­day. “Reck­less trade pro­tec­tion­ism and mis­taken meth­ods that limit fair mar­ket com­pe­ti­tion are not the proper ways to de­velop the Euro­pean Union steel in­dus­try,” it said.

Chi­nese steel prod­ucts rep­re­sent less than 5 per­cent of the Euro­pean mar­ket and do not present a se­ri­ous threat to Euro­pean in­dus­try, the min­istry said. The root cause of Europe’s steel prob­lems was not trade but weak eco­nomic growth, it said. “China hopes the EU will strictly re­spect rel­e­vant World Trade Or­ga­ni­za­tion rules and fully guar­an­tee Chi­nese com­pa­nies’ right to protest,” the min­istry said.

The EU’s du­ties are set at be­tween 13.2 and 22.6 per­cent for hot-rolled flat iron and steel prod­ucts and at be­tween 65.1 and 73.7 per­cent for heavy-plate steel. As pro­vi­sional du­ties they are in place for up to six months un­til the Euro­pean Com­mis­sion com­pletes its in­ves­ti­ga­tion. If up­held, they would typ­i­cally be set for five years. The com­mis­sion has com­mit­ted to speed up its trade de­fense ac­tions un­der pres­sure from EU pro­duc­ers.

The EU has also been de­bat­ing whether to grant China “mar­ket econ­omy sta­tus”, given the Chi­nese gov­ern­ment’s hand in guid­ing in­dus­try and mar­kets. China says the sta­tus is its right come De­cem­ber, which marks 15 years since it joined the WTO. Fail­ure to do so could spark a trade war. The com­mis­sion has said that China is not a mar­ket econ­omy and that it would not rec­og­nize it as such, but would adopt a new method to set du­ties that would abide by WTO rules. —Reuters

BEI­JING: In this Mon­day, Sept 5, 2016 file photo, a woman uses a purse to hide her face as she walks past a gi­ant hand­bag on dis­play at a shop­ping mall. The Amer­i­can and Chi­nese pres­i­dents are call­ing on ma­jor economies to de­fend free trade at a sum­mit held as slug­gish growth and dis­putes over steel and other im­ports fuel de­mands in the United States and Europe to pro­tect lo­cal in­dus­try. —AP

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