EU Adopts Anti-dumping Measures against China, Viet Nam: Diplomatic Sources

This picture taken on 14 July 2005 shows workers at a production line in a shoe factory in Hanoi (AFP Photo)

The European Union on Wednesday adopted, by the narrowest of majorities, new anti-dumping measures to tackle imports of leather shoes from China and Viet Nam, a diplomatic source said.

The vote to adopt the measures for two years resulted in a 13 to 12 majority in the 25-nation EU, the source said.

The vote will allow the new anti-dumping measures to come into force on October 7, with import duties of 16.5 percent on Chinese shoes with leather uppers, in place of the current temporary duty of 19.4 percent.

The tariff on the same kind of shoes from Viet Nam will be 10 percent in place of the current temporary duty of 16.8 percent.

EU Trade Commissioner Peter Mandelson described the measures as "appropriate and proportional".

"Today's decision was necessary," Mandelson told a press conference, adding that the Commission had an obligation to put proposals to member states when an enquiry showed up bad trade practices.

However he stressed that carrying out anti-dumping measures did not mean eliminating price competition among producers.

The move has become urgent as the temporary tariffs, applied in April as an anti-dumping measure, run out at midnight on Thursday.

The main vote faultline runs between Europe's economically liberal north, hostile in principle to anti-dumping measures, and the more protectionist south, sympathetic to the views of EU producers.

The Commission had proposed a five-year penalty, but the compromise on the measure's duration, proposed by France, allowed the vote to go through.

In the vote, taken during a meeting in Brussels of the Committee of the Permanent Representatives of the 25 EU nations, nine countries voted in favour of the two-year measures and 12 maintained their opposition.

The remaining four countries abstained on Wednesday but their votes counted for the proposal as they did not oppose it.

"If the EU's Finnish presidency, which was has been hostile to anti-dumping measures, had played its role better, the compromise could have been reached much earlier," said an EU source.

The decision was bound to raise the hackles of EU distributors who have denounced the sort of protectionism displayed by Italy, whose shoe industry has not well adapted to the new world market.

The Federation of the European Sports Goods Industry (FESI) slammed the "protectionist shoe duties".

Protectionist forces, which "only represent a minority among Europe's footwear industry and governments" succeeded in pushing through the measures "at the expense of European competitiveness and consumers," the group said.

Viet Nam's Leather and Footwear Association, LEFASO, said it had not been informed of the move.

However last month Hanoi vigorously protested against the European Commission's stance on the issue.

The measures are now set to become official by being adopted at a meeting of EU justice and interior ministers in Luxembourg on Thursday.

Brussels stressed that the tariffs will only apply to shoes with leather uppers which account for around one in ten pairs sold in the European Union.

Last year China exported 1.2 billion pairs of shoes to EU countries, 145 million of which were hit by the provisional anti-dumping measures.

For Viet Nam the total EU import figure was 265 million pairs, 80 million of which were affected.

After a 15-month investigation, the commission found that shoemakers in China and Viet Nam unfairly benefited from state aid in the form of soft loans, tax breaks and cheap rents.

China's footwear manufacturers reject the EU's claims.

As Chinese and Vietnamese imports swelled, European footwear production fell by nearly a third in the last five years, costing 40,000 jobs, according to the Commission.

Source: AFP

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