Analysis Of The Difficult Struggle For Chinese Shoe Enterprises In The Ten Years After China's Accession To The WTO

Half a year ago if you buy a pair of Chinese made products in the UK.

China's footwear industry has encountered strong resistance in the face of conflict.

Many Chinese businessmen still remember the Spanish shoe burning incident in 2004. In September of that year, a vicious attack occurred in Spain's largest shoemaking base, eaker, and the burning of Chinese overseas shoe shops. Some illegal elements robbed Chinese businessmen and shoemakers and set fire to the Chinese warehouses. The troublemakers threatened to squeeze all the Chinese shoe traders out of the local market, and the shoe wars between China and Europe were also lit.

From 1995 to 2005, the EU imposed a quota limit of ten years on China's export of leather shoes. In June 2005, the European Union formally announced anti-dumping investigations on two kinds of labor insurance shoes in China. In July July, the European Commission released a notice on the initiation of anti-dumping investigations. The anti-dumping investigation was carried out on some leather shoes from China. The amount involved was as high as 730 million dollars, and the survival of more than 1200 Chinese shoe making enterprises and about 4000000 Chinese shoemaking workers was therefore threatened.

Tough struggle for Chinese shoe companies

Faced with the strong boycott of the European Union, Chinese shoe enterprises embarked on the road of joint struggle. In March 2006, the three footwear associations of Fujian, Guangdong and Zhejiang first formed the EU anti-dumping alliance, and issued a declaration on coping with the alliance.

In April, 14 shoe companies in Wenzhou issued a joint declaration on dealing with the EU's anti-dumping, and urged all Chinese enterprises to respond positively to the alliance and continue to defend their claims in order to win a fair decision.

In May, the leaders of 100 shoemaking enterprises in Chongqing invented the Chongqing declaration, marking that Chinese shoe companies protested the EU's anti dumping response to the alliance's further growth. On the other hand, the trade associations of the Ministry of Commerce of China also made representations with the European Union on many occasions.

Under the multilateral efforts, the EU once again failed to impose quota restrictions on Chinese shoes. In October 2006, the EU made final ruling on the anti-dumping investigation of leather shoes in China. The anti-dumping duty rate dropped from 19.4% to 16.5%, and anti-dumping measures were reduced from five years to two years.

In the same period, the anti-dumping case of labor insurance shoes filed was closed without tax, which made China's footwear products about 30% free from the influence of anti-dumping measures.

At the same time, Chinese shoe companies are ready to launch a new round of plea. They should appeal to the European Court of justice in many of the violations of the law stipulated by the European Commission in the ruling process.

However, in October 2008, the EU launched a final review in spite of the interests of consumers and China's opposition. In December 2009, it decided to extend the anti-dumping measures for another 15 months. Data show that from 2006 to the end of 2010, the sales of leather shoes in China exported to Europe declined by 20%, due to the EU's anti-dumping duties, which directly led to twenty thousand unemployment. Since the EU imposed a high anti-dumping duty on Chinese leather shoes, Chinese shoe enterprises had risen for three times.

Mastering rules and coping with trade protection is a long way to go.

In February 2010, the Chinese side appealed to the WTO against the EU anti-dumping case against China's leather shoes. Under the persistent resistance of the Chinese government and a number of shoe companies, the European Union formally abolished 16.5% of the high anti-dumping duty on Chinese leather shoes since April 1st this year. At this point, the five year old trade protection measures finally ended.

Although the ruling made by WTO in October failed to protect Chinese shoe companies from anti-dumping, it has a profound impact on encouraging Chinese enterprises to grasp the rules of international trade and actively respond to trade protectionism.

For Chinese shoe enterprises, it is necessary to actively respond to complaints and fight stubbornly. Not responding to litigation is a dead end. Industry must be self-discipline and enterprises should be self reliant. This is the fundamental reason for Chinese shoe enterprises to win the "Sino European war".