Top Biz News

Shoe exports: EU penalties have no foot to stand on

By Jiang Wei and Dai Yan (China Daily)
Updated: 2006-04-07 05:49

Chinese exporters lose out.

European manufacturers in China lose out.

European exporters lose out.

And European consumers lose out.

The provisional tariffs slapped on Chinese leather shoes by the European Union (EU) are a lose-lose situation which must be turned around, a top Commerce Ministry official said yesterday.

The EU was not justified in imposing the anti-dumping penalties because there was no credible evidence for denying market economy status to Chinese shoemakers, Vice-Minister of Commerce Gao Hucheng told China Daily.

He was referring to the EU decision to levy provisional tariffs on imports of Chinese leather shoes. The measures come into force today and gradually rise from 4.8 per cent to 19.4 per cent by October, when a final decision is expected.

"The EU declined to grant market economy status to 13 firms it investigated on the spot. But all of them are privately-owned or foreign-invested, and comply with the criteria for market economy treatment," said Gao, also the ministry's international trade negotiation representative.

"It also denied market economy treatment to non-sampled companies, about 150 or 90 per cent of the total respondents, without giving any explanation," he added.

The EU began to give market economy status to some Chinese firms in anti-dumping cases in 1998. As China has not yet been recognized as a full market economy by the EU, the status helps individual companies gain access to the European market.

The EU violated not only World Trade Organization anti-dumping rules but also its own laws and anti-dumping procedures, Gao said, because none of the 160 respondents had received disclosure from the EU on their claim for individual treatment.

The EU's determination on dumping and injury in the case lacks enough evidence, he said.

Shoemaking is a labour-intensive industry in which China enjoys comparative advantages in terms of labour and resources; and the EU should not arbitrarily regard the price advantage of Chinese leather shoes as amounting to dumping, he said.

"Most Chinese shoemakers are small- and medium-sized companies that are not able to dump goods in the EU market," he added.