24/3/2006
EU Adopts Provisional Anti-Dumping Measures For Leather Footwear - by Anthony Pouliquen

The European Commission adopted last week provisional duties against leather shoe producers in China and Vietnam as a measure to prevent dumping flowing from both governments’ subsidies to the industry.

Proposed by EU Trade Commissioner Peter Mandelson, the measures follow a Commission investigation that has found clear evidence of disguised subsidies and unfair state intervention to the leather footwear sector in China and Vietnam.

He said: “These anti-dumping measures will correct the injury caused to European leather shoe producers.

“It is important that we act against unfair trade while encouraging legitimate and competitive from emerging economies.

“We do not target China and Vietnam’s natural competitive advantages, only unfair distortions of trade.”

Duties will be progressively imposed from April to August and will rise to 16.8% for Vietnam and 19.4% for China.

The measures exclude children’s leather shoes for pricing reasons, and Special Technology Advanced Footwear for lack of mass production in the two targeted countries.

A statement released last week said that the measures “confront unfair trade practice, not China and Vietnam’s natural comparative advantage.

“Legitimate low-cost comparative advantages common in developing countries are being topped up in this case with uncompetitive behaviour, that is to say cheap finance, tax holidays, non-market land rents, improper asset valuation and export incentives.”

The statement claims that “EU duties either close the margin of dumping, which is the difference between the export price of the dumped product and its true value or close the margin of injury, which is the difference between the export price of the dumped item and the sales price for the equivalent EU product, whichever is less.”

Yet the Commission states that such measures are limited to EU imports, with no effect on the US or other importing countries.

They concern only 9 shoes from every 100 bought by Europeans, and will increase the average import price by 1.5 Euro and the retail price by 8.5 Euro for pairs sold between 30 and 100 Euro each.