Two-way split over duties on Chinese binder rings

Date: 21/11/1996

By Elizabeth Wise

EU MEMBER states and the Commission's anti-dumping unit are weighing the interests of two European industries off against one another in a battle over Chinese imports.

On one side of the argument are European producers of the metal ring mechanism inserted into binders, who are frustrated that competitive imports from China are increasingly displacing their own goods in European binder production lines.

They are pushing the EU to impose import duties on the Chinese ring mechanisms.

On the other side are binder-makers in Europe, who say they rely on the inexpensive Chinese mechanisms to remain profitable and retain jobs.

“Many member states are being pulled in both directions by their [ring mechanism] manufacturers and their users,” said a Union diplomat.

The EU advisory committee, made up of trade officials from all 15 member states, is currently wrestling with the problem and hopes to agree by next week on whether to recommend duties on the Chinese parts.

Armed with the advisory committee's recommendation, the Council of Ministers must decide whether to impose definitive duties on the Chinese imports, thus prolonging the current provisional duties that expire at the end of this year.

If the Commission decides to opt for definitive duties, they would take effect in January 1997.

Lobbying for the duties are the EU's two main ring mechanism producers, based in Austria and Germany, which together represent fewer than 1,000 employees.

Opponents claim that the Austrian firm has moved most of its production line to Hungary where labour costs are cheaper. They point out that the Union's ring-binder industry accounts for many more jobs than the mechanism sector - and so the impact of imposing duties would be far more serious.

The binder industry is composed mostly of small and medium-sized enterprises, in almost every EU member state. Estimates of the numbers employed by those firms range between 10,000 (according to the Commission) and 43,000 (according to the industry).

“You are looking at protecting fewer than 1,000 jobs, while many more jobs in the downstream industry are at stake,” said an advocate for one of the binder-making firms.

Dumping duties could also harm Europeans who have invested in Chinese ring-mechanism manufacture, said the advocate.

“This case raises the question of whether the Commission ought to be looking more carefully at whom it should be protecting,” he added.