The European Union is set to launch trade barriers on bicycles and ceramic tiles from China, diplomats said on Monday, the latest defensive measures designed to protect EU producers. Plans by the EU Commission to launch five-year punitive import duties worth up to 69.7 percent on the bloc's 275 million euro imports of Chinese bathroom, kitchen and paving tiles received majority backing from trade diplomats from EU states, diplomats said.
The duties aim to counteract what the EU says is illegal Chinese export pricing that hurts the profit margins of EU producers. They must come into effect by mid-September. Chinese bicycle and bicycle part exporters also face an extension until 2016 of existing anti-dumping duties worth up to 48.5 percent, after a Commission plan won approval from a majority of EU states, diplomats said.
The duty extension, which must kick in by mid-October, is likely to ruffle feathers in China, particularly since an extension had originally been planned to last only three years until 2014. EU-Chinese trade relations have been strained in recent weeks by a World Trade Organisation ruling that gives China fresh power to challenge EU tariffs on goods Europe says are being dumped on its market. A separate WTO ruling against Chinese export curbs is likely to be appealed by Beijing in the coming weeks.
European bicycle producers based largely in Germany and Italy made the case that their business was under sufficient threat from unfair Chinese competition to warrant a five-year extension, the maximum period permitted under EU trade rules. China exported nearly 700,000 bicycles and had total bicycle-related exports to the EU worth 430 million euros ($610 million) in 2009, despite the EU anti-dumping duty.
The duties, first imposed in 1993, have frustrated Chinese attempts to gain greater market share in Europe, where sales of bicycles and parts total about 5 billion euros a year. Duties have gradually increased over 18 years. The European Bicycle Manufacturers' Association (EBMA), which represents an industry employing around 20,000 people, mostly in Germany and Italy, requested the extension.