Commission to probe cheap China steel imports

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The Commission has launched an investigation into imports of steel from China, South Korea and Taiwan, which European steelmakers have complained are being dumped on the market at below cost price, putting thousands of jobs at stake.

The investigation will determine whether stainless steel from these countries “is being dumped and whether this dumping has caused injury,” the European Commission announced on 1 February. 

The probe follows a complaint, last October, by the European Confederation of Iron and Steel Industries (Eurofer), which includes giants such as ArcelorMittal and ThyssenKrupp AG. The group claims steel imports from China have surged by a massive 3,300% over the past four years, with domestic prices being undercut by up to 25%.

“We welcome the news that the preliminary analysis of the European Commission confirms that there is sufficient evidence both in terms of dumping and injury caused to the European industry to justify the initiation of a proceeding,” said Eurofer Director General Gordon Moffat. 

The Commission now has nine months to decide whether to impose provisional anti-dumping duties for a six-month period. EU governments will then have 15 months to choose whether to apply “definitive” tariffs that would last for five years. But the decision is likely to prove difficult, with many EU countries, including Britain, Sweden and the Netherlands, traditionally opposed to such measures, considered as protectionist.

“It is bound to be a very sensitive and complex case as there is so much at stake,” said Trade Commissioner Peter Mandelson’s spokesman Peter Power. 

European engineering companies, which rely on cheap steel imports to remain competitive, have notably hit out at the suggestion of anti-dumping measures, arguing that metalworking and mechanical engineering enterprises provide far more jobs throughout the EU than steel production. “Europe needs a long-term global strategy for free and fair trade along the supply chain from raw materials to finished products, rather than its current ‘piece-meal’ approach which takes a very narrow view of the Community’s interest, completely forgetting the interests of customers of the industry,” stressed Adrian Harris, secretary general of Orgalime, the European Engineering Industries Association. 

The question of “Community interest” is at the very heart of the issue as changing global trade patterns increasingly pit one European interest against another. But the sensitive question of how best to deal with these pressures is no closer to being resolved, after strong divisions among member states last month forced the Commission to shelve plans to reform the EU’s trade defense system (EURACTIV 14/01/08). 

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