EU-China steely im­passe

China’s over­ca­pac­ity of steel pro­duc­tion re­mains un­set­tled

The Star Early Edition - - BUSINESS REPORT / INTERNATIONAL - Philip Blenk­in­sop and Robin Em­mott

THE EU AND China failed on Fri­day to reach agree­ment on the prob­lem of steel over­ca­pac­ity and the EU’s stance to­wards Chi­nese dump­ing, de­spite “nar­row­ing dif­fer­ences”.

China, the world’s big­gest pro­ducer and con­sumer of steel, vowed last year to re­duce its ca­pac­ity but Euro­pean steel­mak­ers have com­plained that cheap Chi­nese ex­ports are still flood­ing the mar­ket.

Pres­i­dent of the Euro­pean Com­mis­sion Jean-Claude Juncker told a news con­fer­ence af­ter a meet­ing of EU of­fi­cials with Chi­nese Premier Li Ke­qiang that they had dis­cussed the is­sue of steel over­ca­pac­ity and China’s de­mand that, 15 years af­ter it joined the World Trade Or­ga­ni­za­tion (WTO) it should no longer be treated as a spe­cial case.

“We were able to nar­row the po­si­tions, but we are not yet there,” Juncker said.

A per­son present at the talks said that China had in­sisted on hav­ing a spe­cific ref­er­ence in a con­clud­ing text on the WTO is­sue. China also de­clined to in­clude phrases re­fer­ring to ways to re­solve the prob­lem of steel over­ca­pac­ity.

For a sec­ond year run­ning, the EU-China sum­mit failed to agree on a fi­nal state­ment.

The EU and many of China’s other trad­ing part­ners have de­bated whether to treat China now as a “mar­ket econ­omy”, which would make it more dif­fi­cult to im­pose anti-dump­ing du­ties.

China has launched a le­gal chal­lenge against the EU’s ex­ist­ing anti-dump­ing rules at the WTO, al­though the bloc is in the process of chang­ing its rules on com­bat­ing dump­ing.

Li re­peated that WTO rules had to be im­ple­mented and the EU should ac­cept China’s sit­u­a­tion in the WTO had changed.

“This will send a sig­nal to so­ci­ety and the mar­ket that we both abide by in­ter­na­tional rules and abide by mul­ti­lat­er­al­ism,” Li said, al­though the new EU rules might sat­isfy Beijing.

“The Euro­pean side in­di­cated they are in the mid­dle of a leg­isla­tive amend­ment and it is con­sis­tent with WTO rules. It is non-dis­crim­i­na­tory.” – Reuters

PHOTO: AP

Smoke spews from the sprawl­ing com­plex that is a part of the Ji­u­jiang steel and rolling mills in Qianan in north­ern China’s He­bei prov­ince. Steel over­ca­pac­ity causes fric­tion with the EU.

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