EU governments urged to act against China steel dumping

MEPs from across the political divide have demanded EU-wide action against Chinese steel dumping on the European market.

By Martin Banks

Martin Banks is a senior reporter at the Parliament Magazine

04 Apr 2016

The call follows the outcry over the possible closure of the Tata steel plant in South Wales, with the loss of up to 450 jobs.

The European steel sector directly employs 328,000 people and many more jobs are dependent on it.

But UK government ministers have faced criticism for failing to take more action to prevent the "dumping" of cheap Chinese steel - selling it cheaply at a loss - seen as one of the key reasons for the latest problems in the UK steel industry.


MEPs, though, are united in their call for action to combat Chinese steel dumping onto the European market, which is said to be pushing prices down and making thousands of European steel workers redundant.

There has been a steep increase in Chinese steel imports to the EU, up from 4.5 million tonnes in 2014 to a projected figure of seven million tonnes for last year.

Addressing the crisis, Françoise Grossetête, EPP group Vice-Chair responsible for its working group on economy and environment, said, "A lot of jobs in the European steel sector are threatened and we need concrete measures to address the urgent challenges posed by unfair trade practices.

"We also need a real, long-term strategy which will ensure that European steel has a bright future and contributes to the re-industrialising of the EU," added the French centre-right MEP.

Reinhard Bütikofer, industrial policy spokesperson of the Greens/EFA group, called for more common European resolve in this matter, saying, "We have no time for a European blame game between the national capitals and Brussels. Instead of writing letters to the European Commission, EU governments should take action and do their homework."

He added, "Meanwhile, Chinese overproduction in steel is continuing to grow and hurting Europe's steel industry. China also insists on being granted a market economy status by the end of 2016. The EU needs new trade defence instruments to ensure protection against Chinese dumping after 2016 but the European Commission is lacking resolve in this matter. 

"Business-as-usual won't be good enough."

Further comment came from Conservative industry spokesperson Ashley Fox, who said, "The Commission must be ready to register imports of steel products which threaten domestic steel production and, should dumping be found to be occurring, to impose retrospective duties."

Conservative international trade spokesperson Emma McClarkin supported this approach and said the issue must also be raised at a meeting of the G20 countries in China later this year.

"Furthermore, the Commission should ensure that our partners in the World Trade Organisation are reminded of their obligation to inform of their subsidy regimes regarding steel," she added.

She said that cheap steel imports from countries such as China have contributed to job losses in steel mills across Europe, including the UK.

EU tariffs on steel are currently about nine per cent, compared with the US suggesting tariffs of up to 236 per cent on some products.

Earlier this year, the UK played a key role in blocking higher tariffs on Chinese steel causing Chinese steel to allegedly flood the market.

Axel Eggert, Director General of the European Steel Association, which represents the industry across the continent, said the UK was the "ringleader in a blocking minority of member states that is preventing a European Commission proposal on the modernisation of Europe's trade defence instruments."

A joint letter from European ministers in February advocated using "every means available and strong action" against China and Russia, which have been accused of dumping cheap steel on the market.

China retaliated to the EU threat by slapping new anti-dumping tariffs on European steel imports.

Meanwhile, the potential closure of the Welsh plant, in face of stiff and potentially unfair Chinese competition, is now also a Brexit referendum issue.

British Prime Minister David Cameron has been accused of using the steel crisis to scaremonger over Brexit by claiming the EU would impose punitive steel tariffs on the UK if Britain votes to leave the bloc in its 23 June referendum.

But UKIP leader Nigel Farage, who in February joined 5000 protestors from all across Europe in a march in Brussels against Chinese steel dumping, said, "It is pathetic that the British government must go cap in had to beg the European Commission to prevent dumping of Chinese steel which is causing huge job losses. 

"In a nutshell, it encapsulates why we must have control of our own destiny and a government directly accountable to the British people rather than an unelected Commissioner in Brussels.

"What people are forgetting here is that steel is a strategic industry. This is something in a time of crisis we need and if we lose it we've actually lost something fundamentally important."


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