EU provokes China's double-reverse investigation of China or appeals to WTO

The trade friction between China and the EU is getting worse. Following the EU's decision on May 14 to impose high anti-dumping and countervailing duties on coated paper originating in China, the Ministry of Commerce announced on May 16 the preliminary investigation of the countervailing investigation on imported potato starch originating in the EU. result. According to the information of this reporter, the amount involved in the two cases is not high, and they are all controlled at around $100 million. However, in this case, the changes in EU trade remedies have aroused great concern in the industry. While the EU continues to use anti-dumping remedies, it has also launched countervailing investigations. The EU did not use countervailing in non-market economies in the past. On March 12th, the WTO Appellate Body just ruled that the US Department of Commerce’s “double-reverse” measures against Chinese tires, composite woven bags and other two steel pipes violated WTO rules. On May 16th, a lawyer who participated in the research and consultation of the Ministry of Commerce repeatedly said that the reason why this investigation made the Chinese side feel angry is precisely that the EU simply ignores the ruling just made by the WTO. Several interviewees suggested that the double-reverse investigation is highly contagious. It is expected that follow-up countries such as India and Turkey will follow the EU's investigation of coated paper and other commodities. As China's largest trading partner, the EU has begun to open "double" Anti-"investigations may mean that more European products will suffer in the future." Is the Sino-European trade war at the touch of a button? Respondents believe that the situation is still within the controllable range of the WTO. The amount involved is relatively limited, far less than the level of the trade war. It is expected that the two sides will maintain relative restraint. First round confrontation On May 14, the EU announced a 4%-12% countervailing duty and an 8%-35.1% anti-dumping duty on China's imported coated paper. Among them, among the six Chinese companies that forced the answer, Shandong Chenming Paper (7.82, 0.00, 0.00%) Group Co., Ltd. and Shandong Shouguang Chenming Art Paper Co., Ltd. obtained a 4% countervailing differential rate, but the two companies The anti-dumping ruling rate is as high as 35.1%; Jiangsu Zhenjiang Jindong Paper Co., Ltd. and Jiangsu Jinhuasheng Paper (Suzhou Industrial Park) Co., Ltd. implement a 12% countervailing duty rate and an 8% anti-dumping tax rate; other companies apply 12% anti-dumping The subsidy tax rate and the anti-dumping tax rate of 27.1%. The EU has provoked a "double-reverse" investigation into China or appealed to the WTO. The above-mentioned tariffs are imposed for a period of five years. Zhao Wei, secretary-general of the China Paper Association, accused the EU of abusing trade remedy measures. He said that when the company responded to the lawsuit, it had already questioned the collection of third-party comparison data by the EU when deciding anti-dumping. These data are considered to be mostly from the United States. For the double-reverse survey of coated paper, the United States previously selected India as a comparator. Chinese companies have also defended and hope that although the EU does not recognize China's market economy status, it should recognize the marketization status of the coated paper industry. "This industry has no government subsidies from the entire chain of procurement and pricing, and has achieved a high degree of marketization." Zhao Wei said. However, the EU did not accept the above recommendations. China's largest paper product exporter, Jinguang Paper (China) Investment Co., Ltd., expressed its disagreement with the European side. The company's lawyers suggested that the relevant analysis is unfair, because the EU used the real estate price in Taiwan as a measure of housing prices in mainland China when evaluating the complaint. Sunshine Paper (11.78, 0.00, 0.00%), a company listed on the Shenzhen Stock Exchange, is also one of the six companies in the EU's mandatory answer sheet. According to the export department, the company's current export of coated paper to the EU and the US has basically stagnated. Before the European and American double-reverse investigations, the company exported about 100 million US dollars of coated paper to the United States every year, and also had a small amount of exports to the EU. “The output has not decreased,” the source said. More production was finally released in the domestic market, Southeast Asia, the Middle East, Australia, and Taiwan. China's coated paper previously occupied only 5% of the European market. According to customs statistics, in January-February this year, China exported 881 tons and 567 tons to the EU and the US respectively, down 97.7% and 97.9% respectively, and the market has shrunk extremely. China’s subsequent counterattacks locked the EU’s agriculture. On May 16, the Ministry of Commerce announced the preliminary results of the countervailing investigation on imported potato starch originating in the European Union. The ad valorem rate of Roquette of France was 7.70%. Avibe and Davi in ​​Germany. The ad valorem subsidy rate of the potato potato starch factory is 11.19%, and the ad valorem subsidy rate of other EU companies is 11.19%. On April 19th, the Chinese Ministry of Commerce began to impose an anti-dumping duty of 12.6% to 56.7% on imported potato starch originating in the European Union. Zhou Qingfeng, vice president of China Starch Industry Association, told reporters that the investigation was launched in 2009 and was filed in 2010. The survey found that the potato starch exported from China to China from the planting to processing and acquisition to export, the entire chain has more than 10 government subsidies. “This directly leads to the surprisingly low price of potato starch sold by EU companies in China.” He said that the price of the EU potato starch was US$430/ton in the price of the 2009 survey period. The sales price in China is 3700 yuan / ton, while the price of Chinese companies is as high as 6,300 yuan / ton. Measuring the various costs of EU companies, the cost of potato starch from planting to production in the EU is around €800/tonne. "Without government subsidies, they simply can't make money." Zhou Qingfeng said. EU trade remedies face the face EU's 2010 trade commissioner Carlo De Gucht is considered to be the promoter of the EU trade remedy change, he is more tough than his predecessor Mandelson. In the case of coated paper, the EU first imposed penalties on China on the grounds that it called the government to use illegal subsidies to boost the industry. Previously, the EU has relied on more commonly used anti-dumping penalties, that is, a company exports products at a lower cost. This practice of the EU is considered to follow the United States. The US Department of Commerce has previously imposed anti-dumping duties ranging from 7.60% to 135.83% and countervailing duties between 17.64% and 178.03% on coated paper imported from China. Zhou Shizhen, executive director of the China WTO Research Association, said that according to the ruling of the WTO Appellate Body on the double-counter case of Sino-US tires in March, the WTO actually recognized that it should not be used without recognizing China’s market economy status. The countervailing remedy measures of the state of the market economy are used in China. Second, the WTO recognizes that trade remedy measures against anti-dumping and countervailing should not be adopted for the same commodity at the same time. According to the lawyers involved in the survey, according to the rules of the WTO, the failure of the United States means that the United States must adjust its double ruling rate before the deadline, otherwise it means that China can submit a list of retaliations to the WTO. "This will be Reasonable and legitimate trade retaliation". He said that the EU's double-reverse investigation on coated paper is expected to be appealed to the WTO dispute settlement mechanism by China. Due to the precedent of the above-mentioned precedent, the possibility of winning the case in China's trade dispute with Sino-European coated paper is very high. Big. Yao Jian, spokesman of the Ministry of Commerce, said that China will carefully study and evaluate the final ruling of the EU coated paper case and reserve the right to take corresponding measures according to law. He accused the EU of not adopting a discriminatory and unfair "substitute country" approach in its anti-dumping investigation against China, while insisting on launching a countervailing investigation on Chinese products and simultaneously carrying out anti-dumping and anti-subsidy relief for the same product. , contrary to WTO rules. Zhou Shizhen pointed out that the current countervailing investigations in Europe and the United States mainly focus on attacking land use and financing in China. They believe that Chinese companies obtain land from local governments at low prices, and state-owned enterprises have received preferential treatment from state-controlled banks. loan. However, the EU also has a tradition of subsidies in areas such as agriculture. Hosuk Lee-Makiyama, co-director of the European Centre for International Political Economy and Economics (ECIPE) in Brussels, believes that Carlo De Gucht’s approach is not wise, and Europe has been investing in its agriculture and other industries. Less government subsidies. He said that I believe there will be more such cases. "A new trade war is about to break out," he wrote in a recent article on paper cases, expecting both sides to face disastrous consequences.  

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