Sino-EU Trade Relations Wane over Footwear Dispute

Trade relations between China and the European Union worsened on Tuesday after Brussels made it clear it could not meet Chinese demands to settle an anti-dumping action on shoes.

The European Commission’s trade department this week circulated a proposal to impose extra anti-dumping tariffs on Chinese and Vietnamese footwear after a March ruling that they were being sold too cheaply. The so-called deferred duties would apply once 80 per cent of historical import levels had been reached. That represents 140m pairs from China and 85m from Vietnam.

Beijing had asked for Europe to set a minimum retail price for shoes.

“That is not possible,” said a senior Commission official. “We cannot monitor it. This is a fair and balanced proposal.”

Vietnam is thought to be ready to accept higher tariffs but Chinese companies are pressing the government to take action at the World Trade Organisation.

Mei Xinyu, a researcher with the Chinese Academy of International Trade and Economic Co-operation, a ministry of commerce think-tank, said the new proposal was as objectionable as the initial dumping ruling.

European retailers were also critical. “A tariff-quota system which allows big enough quantities of shoes to come in without payment of anti-dumping duties would be better than the tariffs the Commission proposed last April. But the quotas need to be large enough and the administration must be fair and transparent. If these conditions are not met the consumer will suffer, as there is growing demand which the quotas will not be able to satisfy,” said Horst Widmann, president of the Federation of the European Sporting Goods Industry, representing shoemakers operating in China and Vietnam.

The usual tariff is 12 per cent. That would increase to 23 per cent for China and 29.5 per cent for Vietnam after the quota limit.

The proposal has yet to be endorsed by all commissioners or the 25 member (Source: states.Financial Times,By Andrew Bounds in Brussels/CRIENGLISH.com)

The Commission pointed out there would be no repeat of the bra wars that saw clothing pile up on European quaysides a year ago.