China slams higher European steel tariffs as unjustified

Beijing has criticized new European tariffs on Chinese steel as "unjustifiable" protectionism coming just weeks after commerce ministers from G20 nations pledged to promote free trade.
The European Union said Friday that it had set definitive anti-dumping duties on certain Chinese steel bars at rates higher than initially proposed, following a 2015 investigation prompted by complaints from European steelmaking association Eurofer. The announcement drew an immediate response from the Chinese Ministry of Commerce, which said the EU "unfairly" set new tariffs based on higher profit margin targets for European producers.
Fears of a potential trade war over steel have dominated G20 talks hosted this year by China. The country — the world's largest producer and consumer of steel — is looking to stage a smooth summit showpiece next month in the eastern city of Hangzhou.
In G20 public communiques issued this year, member nations have sought to appear unified, pledging to work together to cut steelmaking capacity at a time when prices are at 10-year lows and struggling mills are closing from Wales to China's Hebei province. Prices have plummeted in recent quarters as China's decades-long construction boom cools.
But tensions remain high. European member states and steel producers accuse China of issuing unfair subsidies and flooding global markets at below-market prices. Beijing, meanwhile, has denied the accusations and said it is working to cut the supply glut even though the central government's efforts to pare down its enormous steelmaking industry — which produces half the world's steel — have met political resistance.
In a statement Friday, China's Ministry of Commerce said it "regretted" Europe's protectionist move after a recently concluded G20 trade ministers' meeting in Shanghai and called on Brussels to "uphold its commitments and avoid sending the wrong signal to the world."
China, the EU's second-largest trading partner, has been seeking "market economy status" from Brussels, which would make it harder for the bloc to impose new anti-dumping tariffs.
EU Commission President Jean-Claude Juncker said in July at the EU-China Summit in Beijing that he would vigorously defend Europe's steel industry. He added that China's handling of the steel issue would shape whether or not Brussels would give it the market economy designation. German and British leaders facing mounting pressure from steelmakers back home have also made similar complaints on visits to Beijing.
In China's five-year plan, central leaders have prioritized restructuring heavy industrial sectors and pushed for mergers between steel and coal producers that would shutter scores of inefficient firms and shed hundreds of thousands of workers. But officials openly acknowledge that local governments and state-owned firms, under political pressure to preserve jobs, have not fully carried out top-level directives from Beijing.

Feng Fei, a vice minister of industry, said Monday that China has cut 13 million tons of excess crude steel capacity in the first half of 2016, less than one-third of its target for the year. Days later, China's top economic planning agency warned that further cuts would be "extremely difficult."

Source: Arab News