The College of Commissioners held an ‘orientation debate’ on the market economy status (MES) of China on 13 January. The decision of whether or not to grant China MES will surely be one of the most important trade topics for the EU in 2016.
At the subsequent briefing, European Commission Vice-President Frans Timmermans recognised the issue’s complexity and far-reaching impact stating, “We must review this question in light of all the important angles for international trade and the EU economy.” He went on to explain that the Commission will come back to the issue in the second half of the year.
Cerame-Unie welcomes the Commission’s commitment to “carefully [assess] the potential impact of any change in methodology on jobs in the European Union”. This is particularly important for a sector such as ceramics, where half of the total direct jobs in the EU are currently covered by anti-dumping duties. These duties, mainly used by SMEs, are the EU’s only effective tool to prevent unfair competition. A change to China’s status would essentially dismantle the EU trade defence system and immediately threaten 100,000 direct ceramic jobs and put up to 3.5 million EU jobs at risk.
The statement released yesterday by the Commission uses the figure of 1.38% to refer to the percentage of Chinese imports currently covered by anti-dumping measures. However, as outlined in this economic note published by industry alliance AEGIS Europe, this figure is misleading. It does not adequately gauge the importance of anti-dumping measures for ensuring a level playing field in the EU.
Renaud Batier, Director General of Cerame-Unie stated, “Yesterday’s discussion seems to indicate that the Commission is going in the right direction by giving itself more time to assess all impacts of such a decision. It is essential that any Commission proposal on this matter is based on a full impact assessment involving all relevant stakeholders and consulting with major trading partners. We look forward to future discussions with the Commission, the Parliament and Member States on this issue and working together towards free and fair trade.”
Further reading on the subject of MES, including the legal aspects, can be found on the AEGIS Europe website.