4/27/2015 3:52:00 PM
HEADLINES
China’s Fastener Industry Opposes EU Tariffs
The China Chamber of Commerce for Import & Export of Machinery and Electronic Products announced opposition to the European Union renewal of tariffs on Chinese steel fasteners.
The Chinese statement was responding to the March 27, 2015, EU decision to reimpose duties ranging from 22.9% to 74.1% on imports of certain steel fasteners from China. The fasteners are used in various products, from automobiles to furniture.
The Global Times quoted WTO expert Tu Xinquan suggesting Chinese manufacturers acquire and merge EU counterparts or cooperating with EU’s OEMs.
“There is a likelihood of recurrence of dumping to the Union market, should the measures be allowed to lapse,” the European Commission said in an official statement.
The EU originally imposed the antidumping duty in 2009. The Chinese government filed a complaint with the WTO, which in 2011 ruled against parts of the tariffs. The EU responded by reducing duties to an average of 54.1%.
The EU claims Chinese fastener manufacturers sell below market value in the EU.
The Chinese Chamber advocates resolving issues through negotiations.
After the initial tariffs, China’s fastener market share fell from 26% to 0.5%.
Fu Donghui, an attorney who represents Chinese manufacturers, told reporter Song Shengxia of Global Times that the EU’s tariffs are not based on the market but by the state as it does not recognize China as a market economy.
Fu said the fastener industry is one of the first industries in China to be privatized and more than 95% of fastener manufacturers are private companies.
Developed economies including the US and the EU refuse to recognize China as a market economy when China joined the WTO in 2001, Shengxia explained. Under a market economy, prices are based on supply and demand instead of a central government setting prices in a non-market economy.
U.S. and EU labeling of China as a non-market economy makes it easier to impose antidumping duties by using price data from a third lower-price country.
The European Commission reiterated in an e-mail sent to the Global Times that the decision followed an investigation which concluded that lifting the duties would bring back dumping prices – harming the EU industry.
Feng Jinyao, director of the China Fastener Industry Association, said the organization will ask the Chinese Ministry of Commerce to challenge the EU tariffs through the WTO. If the EU doesn’t comply with WTO rulings, Feng said the industry would take retaliatory measures.
Feng acknowledged China’s fastener industry has overcapacity and is dominated by basic fasteners. The industry needs to produce more high-end products and focus more on the domestic market to capitalize on the opportunities generated by the country’s “Made in China 2025” strategy, which seeks to upgrade the country’s manufacturing industry, Feng told the Global Times.
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