Trade retaliation may be counter-productive
Trade retaliation may be counter-productive
The EU’s trade-defence rules, which determine when it can impose anti-dumping, anti-subsidy and safeguard measures, were drawn up a decade ago. But they are beginning to show their age. Global supply chains have stretched round the world and many European companies have outsourced production to Asia. As a result, more European companies are being hit by the EU’s own retaliation against unfair competition. That has pitted Europe’s retailers against some of its manufacturers. As one retail boss puts it, views diverge widely: “They [the (ball mill) manufacturers] see China as a threat and we see China as an opportunity”.
Mr Mandelson’s exercise is a chance to rethink what policy would do most good for Europe’s economies. He wants the EU to look again at the “community-interest” test—that anti-dumping duties can be introduced only if they are in the wider interests of European business and consumers. Retailers complain that the test is in practice biased towards producers.
The green paper gives little away about what the European Commission hopes to achieve. Cliff Stevenson, an anti-dumping consultant who has worked for the commission, says that one option could be to extend the definition of community industry to include European businesses with overseas operations. This could give those companies a voice when the commission is investigating an anti-dumping case.
This means the review could be a damp squib. However, there were signs that the Commission is working to meet other trade concerns. This week it said it would push for labour standards to be part of bilateral trade deals with Asian countries, such as India and South Korea. This was welcomed by some European countries. It might help Mr Mandelson to win the argument for a careful expansion of the community interest. But don’t count on it.
Processing your request, Please wait....
