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Strategies & Market Trends : Foreign Trade, Imports, Exports, Markets, Protection

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From: Sam Citron	4/12/2006 2:09:18 PM
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EU Confirms It Will Tax Shoe Imports From Asia Duties Start April 7 on Goods Produced in China, Vietnam A WALL STREET JOURNAL NEWS ROUNDUP March 24, 2006 2:10 a.m. BRUSSELS – The European Union on Thursday confirmed it would impose antidumping duties on Chinese and Vietnamese leather shoes next month, a step that could hit the bottom line of some U.S.-based shoe makers. Timberland Co. said it expects its 2006 profit to be reduced by $10 million because of the duties imposed on exports from its Asian factories into the EU. The company suggested it might have to raise prices in Europe as a result. The European Commission said the trade penalties are necessary to act against a flood of cheap imports from the two countries that it says break world trade rules. The commission said it had identified "clear evidence of disguised subsidies and unfair state intervention to the leather-footwear sector in China and Vietnam." The antidumping measures will be phased in starting April 7 at 4% and will rise to 19.4% for Chinese shoes and 16.8% for Vietnamese footwear during a six-month period. Half of the 2.5 billion pairs of shoes sold in the EU last year came from China. The EU will continue its investigation, slated to close in the autumn, which will decide if the duties should remain in place for as long as five years. China has described as "groundless" EU Trade Commissioner Peter Mandelson's allegations that it is dumping shoes at below-cost prices and is violating fair trade rules. Beijing urged the EU last week to reconsider imposing the proposed sanctions. Mr. Mandelson's office said Thursday the commissioner is still willing "to work with the Vietnamese and Chinese governments." The EU has said imports of leather shoes from China soared 450% to 1.25 billion pairs in 2005 from the same period a year earlier. Vietnamese imports fell 1% to 265 million pairs in 2005 from a year earlier, mainly because of sharper competition with China, but grew 95% from 2001, the EU said.

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