EU states urge rethink on cotton dumping duties

EU states urge rethink on cotton dumping duties

BRUSSELS (Reuters): Eight European Union states yesterday complained to the European Commission over its decision to impose anti-dumping duties on imports of unbleached cotton from six non- EU countries.

In a letter of protest to the 15-nation bloc's executive, the eight said the Commission was wrong to have overruled the majority of EU states, who did not want duties on imports from India, China, Egypt, Indonesia, Pakistan and Turkey.

"I am deeply concerned about the damage that definitive duties would do to the UK textile industry," Britain's Europe Minister Doug Henderson said in a brief statement. "An estimated 7,000 jobs are at risk in the textile finishing sector alone."

Britain was joined by Ireland, Austria, Denmark, Finland, the Netherlands, Germany and Sweden in protesting against the duties, which average 15 percent.

A majority of EU states voted against definitive duties against the same six countries in May 1997 after the Commission had imposed temporary duties in November 1996.

The Commission has until Sept. 9 to propose further measures so EU governments can make a final decision by an Oct. 9 deadline.

EU anti-dumping rules say the Commission may impose provisional anti-dumping duties on goods it concludes are sold at unfairly low prices in the EU. It is then up to member states to decide whether to make these duties definitive.

"A previous investigation was terminated in May 1997 because a majority of EU countries rejected it. There is now even less support," Britain's Henderson added.

European retailers and importers have argued that the duties will increase prices for clothing and cotton goods within the EU, although the bloc's weavers have welcomed the move.

The EU's textile industry employs some 2.5 million workers, dyeing and turning the imported unbleached cotton into clothing and finished products.

The Commission opened its probes after receiving complaints from Eurocoton, a trade association representing the bloc's 5,000 strong weaving industry.

The weavers argue that thousands of jobs are at risk from the cheap imports, while the finishing industry says it could lose jobs over the duties slapped on its raw materials.

Nigel Gardner, spokesman for Trade Commissioner Sir Leon Brittan, told Reuters that EU governments were split over the issue, with southern cotton producers wanting permanent duties, while their northern partners were opposed to any duties.

Gardner said the Commission could now either drop the duties altogether, impose permanent duties or reach agreement with the exporters on minimum prices.

The EU's anti-dumping advisory committee will discuss the options next week, Gardner said.