China Files WTO Complaints over EU Tariff

The simmering dispute between Brussels and Beijing over anti-dumping duties on Chinese footwear in Europe has heated up again, with China issuing a complaint to the World Trade Organization, demanding further justification. A Chinese economist suggests that trade disputes like this are going to continue to fester. Yao Yongmei reports:

Reporter:

The EU decided in last December to extend anti-dumping levies it had previously issued against Chinese shoes for another 15 months.

The EU's decision to extend the duty goes back to a previous probe launched in 2008, when the 16.5-percent two-year anti-dumping duties on Chinese and Vietnamese leather shoes were about to expire.

According to China's Ministry of Commerce, China will negotiate with the EU under WTO's dispute settlement system. Consultation is the first step in the WTO settlement process, and it can last for up to 60 days. After the consultation period, if the talks have failed, China is entitled to request the WTO set up a panel to examine the complaint and rule on the case.

Zuo Xiaolei, the chief economist of Galaxy Securities, says against the backdrop of ongoing global economic crisis, it's unavoidable that trade protectionism is gaining ground.

"History has proved that trade protectionism will rise during economic crisis. Starting from last year, China and the United States and some European countries are at odds in terms of trade relations. The increasing trade conflicts have something to do with the global economic crisis as many countries are facing difficulties in solving their individual financial problems, such as increasing job opportunites and boosting economic recovery. "

The economist points out that the current situation is not favorable for China, given this country traditionally runs trade surpluses.

"Heavier tariffs or other punitive measures hurt the interest of trade-surplus countries the most. China needs to prepare for other countries abusing trade remedy measures. WTO is a good platform for China to lodge its appeal and to protect our legitimate rights."

Meanwhile, Zuo Xiaolei says trade protectionism hurts the interests of both importers and exporters.

Some EU shoe companies have complained that they are the real victims of the duty hike on shoes from China and Vietnam, which make up 30 percent of European footwear sales. The European Footwear Alliance, which represents brands such as Timberland, Ecco, Hush Pupies and Adidas, estimates that EU consumers and businesses could lose hundreds of millions of euros through 2011.

Yao Yongmei, CRI news.