With this policy brief, Brian Hindley of the European Centre for International Political Economy (ECIPE) expresses his doubts on the economic justification of EU anti-dumping actions.
Anti-dumping measures impose a substantial burden on international trade flows – a burden which, according to Hindley, is not justified because anti-dumping practice often rests on flawed economic analysis and “convoluted investigations”, and “can easily degenerate into protectionism”.
The analysis comes as a response to a review of European trade defence instruments, launched by the Commission in December 2006. The Commission’s Green Paper aims to assess how the EU can continue to use anti-dumping, anti-subsidy and safeguard measures “to the best effect in the European interest”, in a world where European business and workers’ interests are increasingly linked with production outside the EU.
However, according to Hindley, the Commission’s Green Paper fails to give a convincing justification of anti-dumping practice and often appears to confuse the case for anti-dumping and the case for anti-subsidy or safeguard action.
This ‘confusion’, he suggests, could be explained by the fact that anti-dumping places the blame for the problems of a European industry on the unfair practices of foreign exporters rather than on the behaviour of the European industry itself; thereby avoiding the harsher course of suggesting that the European industry should adjust. The problem however, as he sees it, is that adjustment is quite often in the interests of the industry.
Click here to read the full policy brief.