Industry representatives protest over Chinese exports
China's steel exports are strictly in line with the international trade rules, and European steel industry representatives should be more rational when tackling the overcapacity issue, an expert said Monday.
The comment came after thousands of European steelmakers descended on the EU capital Brussels on Monday demanding that officials do more to stop the flood of cheap imports from China. Police said about 5,200 representatives from Europe's struggling steel industry circled the EU's Berlaymont headquarters demanding that China be denied market economy status, an official designation that would make it harder to raise barriers against cheap Chinese steel products.
"As labor costs in China are still lower than in the EU, it makes domestic steel products cheaper," Xu Hongcai, director of the Economic Research Department of the China Center for International Economic Exchanges, told the Global Times late Monday night.
Xu noted that the low price of Chinese steel products does not necessarily mean that the central government is using tariffs or subsidies to protect the domestic steel industry.
Europe's industrial decline has picked up pace in recent years, with some 85,000 jobs lost in the steel sector alone since 2008, more than 20 percent of the workforce, thanks in part to a flood of cheap Chinese imports, Reuters reported earlier on February 8.
"While facing the overcapacity issue, industry representatives in the EU should calm down instead of blaming China," Xu said.
China joined the World Trade Organization (WTO) in 2001 as a developing country with an economy run largely by the State but was promised a review within 15 years to win a change in status to put it on a par with its major trading partners.
Without market economy status, the WTO's 162 member countries are much freer to slap anti-dumping measures on cheap Chinese products.
"It's a crucial year to review the status," Xu said, noting that the nation should be confident as it has always followed the WTO rules.
A Ministry of Commerce (MOFCOM) official on Sunday said that he expected the European Commission (EC) to strictly follow the WTO rules in its anti-dumping investigation into Chinese steel exports.
The MOFCOM official said that the EC should be prudent, restrained and lawful in employing trade remedy instruments.
The US and Canada appear determined to continue denying China market economy status, but Europe may forge ahead in an effort to avoid angering Chinese authorities.
