New Trade Barriers Focus On Rules Of Origin

In recent years, the major importers of textiles and clothing, such as Europe, America and Japan, have set high limits on exports of products from developing countries. Among the many tariff policies and technical regulations, the relevant provisions on origin identification are the most "implicit" and the most directive. Since this year, Italy and Saudi customs have issued mandatory regulations on the origin of textile, footwear and leather products. In recent days, the EU has also planned to develop a label system for the country of origin of garments. After experiencing the baptism of the financial crisis, the textile industry of every country has made frequent moves to protect the interests of its own industries. This form of trade protection will not only close the door to some developing countries which are mainly processing trade, but also become the hidden worry of their products occupying the quota of importing countries passively.

　　 New excuse for trade protectors

With the development of trade liberalization, tariff as a measure to protect trade is gradually weakening. In order to make up for the inadequacy of tariff functions, the major importers of textile products have adopted protective measures with greater concealment, lower transparency, and less supervision and prediction over the years. As a "grey" policy tool, rules of origin are favored by these importing countries.

More than a month ago, the "Italy made" law of origin was finally approved by the Senate and will be formally implemented on October 1st this year. The regulations will impose mandatory labels on the sales of textile, footwear and leather products. The regulations mentioned that labels of various products must identify the origin of products, indicate the instructions for use, and comply with the processing procedures, hygienic standards and safety and reliability of products. At the same time, enterprises violating the regulation will be fined 50 thousand ~7 euros, and enterprises with repeated violations will be fined for 3 years.

Compared with maintaining market order and safeguarding consumers' rights and interests, protecting the interests of domestic industries may be the fundamental purpose of adopting this measure. As early as last year, when the Italy house of Representatives drew up the bill, Adolfo Urso, Vice Minister of economic development of the country, said that the bill would serve as a banner to help create a truly "Italy made" product image. Most congressmen believe that the passage of the bill will be very beneficial to the industrial recovery of the country, which can provide about 1 million jobs for Italy.

More than Italy is keen on this new means of trade protection. Recently, it is also reported that the EU intends to enforce the label system of clothing country of origin so as to prevent consumers from buying products from third countries originating outside the EU without knowing it. It is understood that the EU's current country of origin label is voluntary, and the use and labeling of labels are different according to the national laws of different countries. After the mandatory implementation of the label system of clothing country of origin, the contents of the existing labels containing only the names of textile fibers should be supplemented.

　　 The premise of differential treatment

In international trade, due to the different treatment of tariff and other trade measures, the origin of products is an important basis for deciding whether or not they can enjoy certain tariff treatment. Especially in countries that adopt trade measures such as import and export quotas, anti-dumping, countervailing measures and trade sanctions, only by accurately judging the origin of goods, the trade measures they take can play a role.

To protect the manufacture of Italy, perhaps we can interpret it as "protecting the Italy industry". For the relevant imported products manufactured in Italy, after attributing to the origin of our country, we will undoubtedly lose the high exemption from Italy. The EU's label system of clothing country of origin will also make the products of some developing countries face the same situation. From the perspective of appearance, these imported products may lose a group of consumers who have a high degree of loyalty to local products. The deeper implication is that such products, such as the finished fabric products only finished in Italy, will be occupied by Italy's quota restrictions on the countries of origin after being deprived of the "Italy manufacturing" signature right, thus affecting the export situation of the country and the bilateral trade statistics of the two countries.

The rules of origin are the precondition for different countries to implement differential treatment, especially when they take anti-dumping measures. Judging the "economic nationality" of the products is not only convenient for their targeted implementation, but also in the process of anti-dumping, countries try to use different rules of origin to achieve the purpose of anti circumvention. China's current rules of origin are relatively low in determining the "economic nationality" of our export products. Many foreign products are therefore covered with "made in China" clothes and sold in the international market in the name of Chinese products. When the product is dumping on other countries, China has become the object of anti-dumping and the victim of trade disputes.

　　 Bypass barriers have a way to follow.

Today, with the acceleration of economic globalization and regional economic integration, the importance of rules of origin in the field of international trade is increasingly significant. Despite such an era dominated by importing powers, they restrict the influx of textiles and clothing in a large number of developing countries through various kinds of trade protection measures. However, we can still guarantee the share of export market in some ways and avoid trade barriers.

The start of the China ASEAN Free Trade Area has opened another window for export enterprises, and the rules of origin of the free trade area are based on the "value-added standard". According to the agreement on trade in goods between the China ASEAN Free Trade Area, if the local processing value of a product is not less than 40% of the total value of the product, the product can be regarded as a product originating from China ASEAN Free Trade Area, enjoying preferential tariff treatment in the import and export trade.

That is to say, as long as a product is located in a free trade area and is not limited to a free trade area, the value of the raw material exceeds 40% of the total value, so it can be regarded as the original product of the China ASEAN Free Trade Area. China's textile export enterprises can make use of the advantages of low cost of labor in Bangladesh and Vietnam to launch processing trade in ASEAN. Some local sales, some of which are exported to the European Union and other countries in these areas, make effective use of the "regional origin accumulation" provisions of these developed countries and enjoy preferential treatment.

In addition to vigorously developing overseas processing trade, improving export commodity structure, implementing market diversification strategy and reducing dependence on European and American markets will also reduce the risk of China's textile and clothing export. In addition, strengthening the understanding and research of rules of origin in developed countries should also become a compulsory course for export enterprises in China.