European Union has no plans to amend cotton dumping proposal
European Union has no plans to amend cotton dumping proposal
BRUSSELS (Reuters): The European Commission has no plans to amend its proposal for dumping duties on unbleached cotton imports, despite opposition from a majority of European Union governments, a Commission spokesman said on Friday.
The Commission, the EU's executive body, called in July for five-year anti-dumping duties averaging 12 percent on imports of unbleached cotton fabrics from China, Egypt, India, Indonesia and Pakistan.
The Commission said producers in the countries had undercut the prices of EU-based weavers, harming the European industry.
The Commission's proposal needs to win support from a majority of the 15 EU member governments to take effect.
But, at a working-group meeting of trade officials this week, eight countries said they would vote against the proposal for duties, indicating it is heading for defeat unless one or more governments changes its mind in the next few weeks.
Mainly northern-European countries with big cotton-finishing businesses are wary of having to pay more for their raw materials.
Commission spokesman Nigel Gardner said the case was now in the hands of EU governments, collectively called the Council of Ministers, which has until October 9 to reach a final decision.
"As is always the case, the Commission can adapt a proposal before the Council if it helps. But we have no intention of doing that at the moment," Gardner told reporters.
"The ball is in the Council's court," he said.
He said the Commission was not abandoning its idea of offering to allow exporters in the five targeted countries to charge certain minimum prices instead of paying the duties.
Other EU sources said the position could always change, but at the moment, it seemed unlikely the Commission's proposal could win the required majority support.
The dumping proposal is expected to be discussed next by EU ambassadors before a final decision is taken by foreign ministers, probably at a Luxembourg meeting on October 5 and 6.
At this week's working group meeting, six countries, including France and Italy, backed duties while eight countries, including Britain and Germany, were opposed. Belgium abstained.
It is not the first time the cotton dumping issue has caused divisions in the EU. Last year, the Commission failed to win governments' support for five-year dumping duties on grey cloth from the same five countries plus Turkey.
Despite this setback, the Commission in April imposed provisional, six-month anti-dumping duties on imports of unbleached cotton fabrics from China, Egypt, India, Indonesia, Pakistan and Turkey. Three months later, it asked EU governments to approve definitive, five-year duties on five of the countries but exempted Turkey.
The Commission can impose provisional anti-dumping duties at its own discretion but needs EU governments' go-ahead for definitive duties.
The controversial case has set northern EU states against southern ones and European weavers, who complain of unfair competition, against textile finishers opposed to duties on their raw materials. Developing countries involved have reacted angrily to the Commission's proposal for duties.
Unbleached cotton fabric is a raw material for the textile finishing industry, which transforms it into bleached, dyed and printed fabrics used to make clothes and home furnishings.
Exports from the five countries targeted for duties account for about 40 percent of the EU market with a value of 415 million ecu ($473 million), the Commission says.