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EU Advised to Reconsider Dumping Claim
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China has urged the European Union (EU) to re-investigate its dumping claim against Chinese leather shoes in the interest of fairness.

Europe lacks evidence to support its claim that Chinese shoe exporters are dumping goods, Chong Quan, a spokesman for the Ministry of Commerce, said on Friday.

Chong was responding to EU Trade Commissioner Peter Mandelson's latest proposal that called for duties on Chinese leather shoes to increase in phases but quickly.

Mandelson said in a press release that they had found "compelling evidence of state intervention, dumping and injury."

If Mandelson's proposal is approved, the EU will impose a 4.8 percent penalty duty on leather shoes from China beginning on April 1. The figure will increase to 19.4 percent by October.

This proposal is scheduled to be discussed earlier next month.

Chong denied the EU dumping charge, saying the EU's plan to levy anti-dumping tariffs on Chinese leather shoes was protectionist and contradicted the trend of trade liberalization.

He called for a review of the decision and asked the EU to treat the Chinese companies fairly.

Denying Chinese shoe makers market economy treatment is particularly unfair, he said.

The European Commission declined to give market economy treatment to 13 Chinese leather manufacturers, which it investigated last September.

As the EU does not yet regard China as a full market economy, China believes it is vital for its enterprises to receive separate treatment in anti-dumping cases. Otherwise, the European side will take the prices of a third country, such as Brazil, as a substitute. Generally labour and material costs are higher in those countries than in China.

"The EU ignores the fact that 98 percent of shoe manufacturers are funded by private and foreign capital. Refusing to grant market economy treatment to Chinese shoe makers is a discriminatory action violating the principles of fair trade," Chong said.

The shoe manufacturing industry is one of the most market-oriented sectors in China, he added.

Although Mandelson's proposal is supported by shoe manufacturers in southern European countries, it is condemned by EU importers, retailers and shoe makers that have plants in China.

Peter Bolliger, chief executive of the shoe maker and retailer Clarks, was quoted by the Guardian of London as saying: "Our initial observation is one of disappointment. While noting the ... exemption for children's shoes, we know this is not guaranteed and is subject to challenge from sections of the industry, which must be a matter of great concern to all parents."

The dumping charge, initiated by European shoe manufacturers last July, is the largest for China in both value and volume. It affects an export of US$670 million and about 4 million jobs.

China produces about 8 billion pairs of shoes a year, and the EU is second-largest overseas market for Chinese footwear, following the United States.

(China Daily February 25, 2006)

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