China slaps EU, Japan and South Korea with steel import ‘tariffs’
Measures intended to prevent sale of products at below cost
BEIJING, July 24, (Agencies): China said Sunday it has started imposing anti-dumping tariffs on certain steel imports from the European Union, Japan and South Korea, as Beijing itself comes under fire for similar trade practices.
Duties on the materials, used in power transformers and electric motors, will range from around 37 to as high as 46.3 percent, the commerce ministry said on its website.
The measures are intended to prevent the sale of the product at below cost, a practice known as dumping, it added.
The world’s second largest economy, which makes more than half the world’s steel, finds itself under attack by EU countries for allegedly flooding world markets with steel and aluminium in violation of international trade agreements.
On Friday Premier Li Keqiang told a group of visiting leaders from the World Bank, International Monetary Fund and other organisations that China “will not engage in a trade war or currency war”.
Nevertheless, the EU sees itself under attack. Earlier this month in Beijing, EU Commission head Jean-Claude Juncker pledged to defend the group’s steel industry against China using “all the means at our disposal”.
He also said there was a “clear link” between the steel issue and the EU’s decision on whether to grant China “market economy status” — a prize eagerly sought by Beijing.
China has been pressing the EU to grant it the status — which would make it harder for the bloc to levy anti-dumping tariffs — before the year’s end, citing World Trade Organisation rules. China’s announcement is the latest in a tit-for-tat fight with other countries over the special metal known as oriented electrical steel.
In May last year the EU imposed similar duties on imports of Chinese oriented electric steel as well as products from other countries, in a move which Bloomberg News said was intended to curb competition for EU producers.
The decision prompted China to launch an investigation into imports from the European manufacturers.
China has imposed such duties before. In 2012 the World Trade Organisation ruled that Chinese duties on high-tech steel from the US violated trade rules. In 2015 the organisation censured Beijing for continuing the practice despite the judgement against it.
Imports of grain-oriented electrical steel — used in the manufacture of large generators and electricity transformers — will be charged duties ranging from 37.3 percent to 46.3 percent, the ministry said on its website.
China started levying the duties on Saturday and will continue to do so for five years, the statement said. An investigation found that underpriced steel was hurting Chinese industry, it added.
Mounting
For its part, Beijing faces mounting criticism from the United States and Europe that it is exporting steel at unfairly low prices to clear a backlog. Western governments say that hurts their producers and threatens thousands of jobs.
Meanwhile, the world’s top economies will work to tackle excess production capacity in steel and some other industries, including government subsidies that have distorted markets, G20 finance officials said on Saturday.
In a draft statement obtained by Reuters, the G20 finance ministers and central bank governors meeting in China’s southwestern city of Chengdu said that excess capacity problems, “exacerbated by a weak global economic recovery and depressed market demand, have caused a negative impact on trade and workers.”
The document, which is still subject to change until a final version, adopted the same language agreed by G20 trade ministers on July 10.
Excess capacity in steel industry has been a hot-button issue for many G20 countries this year amid a slowdown in global demand that has led to a steel glut, layoffs and idled mills.
Officials from the United States and other countries have accused China, which produces over half the world’s steel, for keeping too many steel plants afloat with subsidies and other government support and allowing excess production to be dumped onto world markets.
The US Commerce Department has imposed hefty anti-dumping and antisubsidy duties against a number of Chinese steel products in recent months, in some cases more than 250 percent of the selling price. On Thursday, it levied duties of up to 25.6 percent on imports of cold-rolled flat steel used in cars and appliances from Britain, Russia, India, Brazil and South Korea.