New chapters in EU-China trade disputes

Signature of the letter of intent regarding fighting counterfeiting in trade in alcoholic beverages by Zhi Shuping, Minister of the Administration of Quality Supervision, Inspection and Quarantine the People’s Republic of China (AQSIQ) on the right, and Dacian Cioloș, Member of the EC in charge of Agriculture and Rural Development on official visit to China on the left. EU Agricultural products are easy targets in trade disputes, due to the huge subsidies the EU pays to its farmers. China has already singled out European wines for being heavily subsidised with public money. (EC Audiovisual Services, 23/07/2013).

Signature of the letter of intent regarding fighting counterfeiting in trade in alcoholic beverages by Zhi Shuping, Minister of the Administration of Quality Supervision, Inspection and Quarantine the People’s Republic of China (AQSIQ) on the right, and Dacian Cioloș, Member of the EC in charge of Agriculture and Rural Development on official visit to China on the left. EU Agricultural products are easy targets in trade disputes, due to the huge subsidies the EU pays to its farmers. China has already singled out the European wines as being heavily subsidised with public money. (EC Audiovisual Services, 23/07/2013).

This year there was no summer recess for the European Commission Directorate General for Trade (DG TRADE) and more precisely for the Directorate C which is competent for Asia. China kept the department’s bureaucrats busy all along this August, because on the 7th and the 16th of this month the Directorate produced two major cases on the trade relations with the Asian giant.

EU and China are two of the biggest traders in the world. China is now the Union’s second trading partner (after the United States) and the EU is China’s biggest trading partner. The value of their exchanges exceeds €1 billion a day while they invested at least €25bn at each other’s territory last year. Europe runs a deficit trade balance with China but it has a positive balance in services.

Steel tubes

The latest developments in EU’s trade relations with China came on the 16th of August. The European Union filed a request with the World Trade Organisation (WTO) to counter the Chinese antidumping duties on its steel tubes. In detail the EU asked the WTO to rule over a dispute concerning the Chinese antidumping duties imposed on imports of high-performance stainless steel seamless tubes (“HP-SSST”) from the EU. According to WTO procedures the Organisation will set up a Panel to examine the petition.

The relevant Press release published by the DG TRADE in mid – August 2013 says that the “EU exports of these tubes to China were worth some €90 million in 2009, but fell to under €20 million around the time when China imposed definitive anti-dumping duties in November 2012. Since then, the duties of 9.7% to 11.1% imposed on imports of steel tubes from the EU are significantly hampering access to the Chinese market”. On that occasion the EU Trade spokesman, John Clancy, had said “we are confident that the WTO will support our claims against these anti-dumping duties”. He had arguments to support this position but there is always the other side.

The case is not simple. The EU narrative is that China imposed the antidumping levy on steel tubes imported from the European Union and Japan, after the EU had applied a provisional anti-dumping duty on imports of certain seamless pipes and tubes of stainless steel originating in China. The EU’s request for the establishment of a WTO panel was to be discussed for the first time at the meeting of the WTO Dispute Settlement Body (DSB) of 30 August 2013. In view of that the EU feared that China might, under the dispute settlement rules of the WTO, object to the establishment of the panel. China however didn’t block it.

According to WTO the dispute settlement panel was actually decided on 30 August 2013. The relevant WTO report confirms that “China said that the imposition of the anti-dumping measure was consistent with its obligations under WTO rules…In order to allow the proceedings in the two disputes to be promptly harmonized, China agreed to the establishment of a panel…”. Obviously China didn’t want to avoid a swift settlement and the issue is bound to be resolved along the WTO procedures. The problem is that it remains to be clarified what will happen with the European antidumping duties on similar Chinese products.

Solar panels

Seemingly the trade disputes between the EU and China have no end. Chinese solar panel imports in the EU, due to the large economic content of this trade, have been for quite some time a friction point between the two trade superpowers. For months the Europeans were threatening these Chinese products with antidumping duties of up to 47.6%. The issue gained also widespread publicity because in China as well as in Europe producers are suffering from overproduction. In Germany the sector faces grave problems with the Conergy Group having already applied for bankruptcy. More German companies face existential problems (Q-cells, Bosch solar, Sovello, Odersun). The same is true for some major solar panel producers in China.

In view of the gravity of the whole affair the European Union agreed with China on 27 July 2013 to settle the issue ‘amicably’ and the two sides inked an agreement detailing their reciprocal obligations. Events however didn’t evolve quite that way. The European Sting followed very closely the whole story. On 9 August the Sting writer Dennis Kefalakos stressed that, {In an unexpected move the European Commission announced on Wednesday 7 August that it “…continues its anti-subsidy investigation on solar panels from China…”, and this only a few days after Commissioner Karel De Gucht, responsible for foreign trade had stated on 27 July that the issue had been concluded ‘amicably’ between Brussels and Beijing. In contrast to that De Gucht said that “in this case, the investigation will continue without provisional measures and the Commission will continue working actively on the case in order to arrive to definitive findings that are due at the end of this year”}.

In short nothing is settled between Europe and China as far as those two important products are concerned (steel tubes and solar panels). The fact is though that they represent only a very tiny part of the vast commercial exchanges between the two sides. Still those two products haunt the EU-China relations threatening also the huge direct investments the two sides plan to realise in each other’s territory.

Both sides however have expressed their strong commitment to settle their trade disputes along the lines of the WTO procedures. In no case Europe or China would take measures against each other to jeopardise their huge mutual interests. Jobs and incomes of thousands of people in both sides are at stake.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Libya: EU efforts should focus on protecting migrants, MEPs say

This new way of understanding disease is changing medicine

Action needed to end deadly clashes between African herders and farmers: UN chief

The four top Americans who flew to Europe perplexed things about Trump’s intentions

“A Junior Enterprise is run only by students.. there are no professors or managers that can help you solve your problems”

EU-India summit: Will the EU manage to sign a free trade agreement with India before Britain?

Africa-Europe Alliance: first projects kicked off just three months after launch

The German automotive industry under the Trump spell

Fight against climate change and poverty will fail without overhaul of global financial system, says major UN report

Eurozone closer to a deflation – stagnation trap

Why Commissioner Rehn wants us all to work more for less

Syrian Refugees in Germany face distinctly different challenges than those in Lebanon

Consumers suffer three defeats

Is a full course lunch, a new Commissioner and 2 million anti-TTIP citizens what you would call a “Fresh Start”?

What we take for granted: The EU is not perfect

Who the US and China have trade disputes with

EU makes key TTIP document public as protests get louder

ILO’s Bureau for Employers´Activities to publish new study on women in business and management

3 autonomous vehicle trends to follow in 2019

Second Facebook-Cambridge Analytica hearing: impact on privacy, voting and trust

This is what a planet-wide network of ocean sanctuaries could look like

EU budget: the Common Agricultural Policy beyond 2020

‘Global care crisis’ set to affect 2.3 billion people warns UN labour agency

Guatemala: UN anti-corruption body will continue working, as Constitutional Court blocks Government expulsion

COP21 Breaking News_03 December: Unprecedented Global Alliance for Buildings and Construction to Combat Climate Change

Why the ECB prepares to flood the markets with more and free of charge euro; everybody needs that now

This is our chance to completely redefine the meaning of work

Greece and Ukraine main items on EU28 menu; the course is set

Eurozone: The crisis hit countries are again subsidizing the German and French banks

The Indian miracle state pointing the way to global sustainability

EU Commission: Germany can make Eurozone grow again just by helping itself

Chinese Premier Li Keqiang’s speech from World Economic Forum’s Annual Meeting of New Champions

Press coverage of migration crisis in Europe: a call for collaborative action

Parliament demands ban on neo-fascist and neo-Nazi groups in the EU

Climate change recognized as ‘threat multiplier’, UN Security Council debates its impact on peace

2 trillion drinks containers are made every year – so where do they go?

Water supply a human right but Greeks to lose their functioning utilities

Darfur: Inter-communal tensions still high despite improved security, Mission head tells Security Council

Brexit: when the hubris of one man can set the UK, the EU and the entire world on fire

Marking Sir Brian Urquhart’s 100th birthday, UN honours life-long servant of ‘we the peoples’

Mandela, ‘true symbol of human greatness’, celebrated on centenary of his birth

ECB’s first flight in Eurozone’s banking universe will be just a reconnaissance

Syria: ‘Violence, displacement’ and cold kill 11 infants ‘in the past two days’

Tuesday’s Daily Brief: Bicycles for the environment, new leader for the UN General Assembly, UN values, Ebola, Syria and Libya

EU-China Light Bridge in Brussels signals the bright coming of the Year of The Dog

‘Never give up’: UN chief urges all who serve, marking UN Day

Venezuela: UN human rights office calls for ‘maximum restraint’ by authorities in face of new demonstrations

The EU Commission does nothing about the food retailing oligopoly

MEPs want to ensure sufficient funding for Connecting Europe’s future

We need to talk about failure in the social sector

Long live Eurozone’s bank supervisor down with the EU budget supremo

Why Obama asks approval from Congress to bomb Syria?

UK voters sent strong message to May and Corbyn for soft Brexit

COP21 Breaking News_05 December: Ban Ki-Moon Closing Address at COP21 Action Day Innovation, Imagination, Faster Climate Action

The 28 EU leaders show contempt for the European Elections results

WEF Davos 2016 LIVE: “No other problem has jeopardised the EU as much as the refugee question” Joachim Gauck, President of the Federal Republic of Germany, cries out from Davos

Love unlimited

Medical students of today, technological doctors of tomorrow

Why Eurozone urgently needs the ECB to print and distribute at least €500 billion

European Youth Forum welcomes the European Commission’s proposed revision of the Union Code on Visas, however it does not go far enough

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s