Shoe Enterprises Should Face Anti-Dumping And Realize The Growth Of China'S Footwear Industry

Editor's note: according to the provisions of Annex 7 to China's accession to the WTO, the EU should gradually cancel the import quotas for shoes exported to China from 2001 to 2005.

But after the 5 year pitional period, the EU's so-called anti-dumping against Chinese footwear has not ended.

There are too many interests involved in this, "cut constantly, manage chaos", it seems that the EU's shoes and Chinese shoes are doomed to be entangled together, hate each other, the EU attack, Chinese shoe enterprises counterattack, the campaign has not yet been cleaned up, Chinese shoe enterprises are forced to meet the next brutal campaign.

In 2008, the EU launched an anti dumping stick against China's footwear industry again. Chinese shoe companies learned to fight back, though this is a protracted war.

In 2008 and October 2nd, the European Commission announced that the EU will temporarily maintain anti-dumping duties on leather shoes produced by the two countries as a result of the initiation of anti-dumping review procedures for leather shoes in China and Vietnam.

The decision means that the EU's 16.5% year anti-dumping duty on leather shoes and children's shoes imported from China in 2006 will be extended for another 12 to 15 months.

A spokesman for the EU Trade Commissioner Mandelson said the EU will investigate the export of leather shoes from China and Vietnam to Europe. The anti-dumping duty is temporarily maintained before the investigation is completed, that is, the European Union has extended the anti-dumping duty on Chinese leather shoes in disguised form.

EU's footwear anti-dumping has a direct impact on Chinese shoes. EU anti-dumping has brought pressure and impact on China's shoe export.

The pressure can be embodied in the quantity and amount of leather shoes export.

In the first half of July this year, China's growth in footwear exports to the EU decreased significantly, but the unit price increased significantly.

From 1 to July, 940 million pairs of shoes exported, an increase of 7.57% over the same period last year, an increase of 9.3 percentage points, an increase of 3 billion 200 million US dollars, an increase of 14.15%, an increase of 5.6 percentage points, and an increase of 6.23% percentage points in the price of 3.41 US dollars / double, an increase of 4 percentage points.

The unit price of Chinese shoe exports is rising, but at the same time, the rising part is offset by the rising cost of various factors.

The EU's anti-dumping effect is to promote the structural adjustment of China's export shoes.

The EU has only imposed anti-dumping restrictions on genuine leather shoes, and the export bases of all leather shoes have changed the strategy of exporting shoes.

Wenzhou has made effective product structure adjustment to the shoes exported to the EU, from the original leather to the non leather shoes. At the same time, Wenzhou shoes actively explored other world markets outside the European Union, and opened up the American market with lower consumption power due to the subprime mortgage crisis.

Guangzhou's Zhongshan exports to the EU rubber and plastic or recycled leather shoes have increased significantly, but also the main energy to the United States and other emerging markets.

The sunset review is a double-edged sword, but the Chinese shoe enterprises should respond differently. The so-called review is the continuation of the original investigation procedure. To a large extent, the review procedure is the same as the original investigation procedure.

For the prosecution company, which is part of the European Union's shoe manufacturers, it can make use of the review to further crack down on Chinese shoes that have already imposed anti-dumping duties, making it difficult for Chinese shoes to enter the EU market.

For Chinese shoe makers, it is entirely possible to go back to the European market again through anti-dumping review.

Therefore, in the face of reexamination, we hope that enterprises can recapture or further expand their share in the EU market through the anti-dumping investigation, so as to achieve the effect of "market reshuffle".

In September 2007, the European Union suspected that China's export of European leather shoes had been circumventing Macao's pshipment. It announced that it would register and conduct anti circumvention investigations on imported footwear products imported from Macao.

At that time, only a few Chinese shoe companies, such as AOKANG group, Wenzhou Tamar, Guangdong golden shoe and new Hong Kong dollar, completed the first round of defense against the EU anti-dumping lawsuit.

In this sunset review, the attitude of Chinese shoe enterprises is quite different.

In 2008, in October 2nd, the EU launched anti-dumping review procedures for leather shoes in China and Vietnam. According to the requirements of the European Union, China's respondent shoe enterprises should submit a sampling questionnaire within 15 days, and submit a questionnaire response within 40 days.

Individual enterprises can also apply to the European Union to examine whether their tax rates are appropriate.

According to the survey, the European Union will decide whether to continue to maintain anti-dumping duties, which will normally last 12 months to 15 months, and continue to levy anti-dumping duties during the period.

In response to anti-dumping, the Ministry of Commerce came out in time, first regretted that the EU initiated anti-dumping review.

Then, act quickly to stimulate the enthusiasm of all shoe manufacturers to deal with anti-dumping.

October 8th, Wenzhou, Zhejiang; October 9th, Guangdong Zhongshan; October 10th, Fujian Quanzhou.

Under the leadership of the Ministry of Commerce, China Chamber of Commerce for the import and export of light industrial arts and crafts and China Leather Association have been participating in the production base of shoes, calling for the opening of the "sunset review" Coordinating Committee of the European Union on Chinese leather shoes.

Guangdong and Wenzhou are China's two largest export bases for shoes, and are also the most injured in the EU's two-year anti-dumping measures.

At present, Guangdong shoe enterprises have formed an alliance of enterprises to embrace anti-dumping.

Wenzhou shoe enterprises Kangnai, AOKANG, Dongyi, Tamar and other leading enterprises are actively preparing materials, will re apply for market economy status to the EU, that is, to lodge a protest against the European Union.

However, some Quanzhou shoe enterprises are not active in this plea.

It is understood that in the previous round of the EU's investigation on the market economy status, there were 48 enterprises involved in Quanzhou, and among the 13 enterprises sampled by EU officials to China, two were from Hengtai and rich birds in Quanzhou.

As one of the 13 enterprises being selected, the Hengtai shoe industry has been passionate and actively defended.

Earlier, Su Wenbin, the general manager of the company, even went to Europe to receive interviews with local newspapers and television media, reflecting the real situation and striving for rights.

However, after several arguments failed, Su Wenbin thought that the anti-dumping case was no longer a simple commercial defense game.

Some companies believe that the EU's decision to impose anti-dumping duties on Chinese leather shoes is a joint act of some EU countries, with its national interests as its background. If enterprises lack the support of the government and industry, it is hard to win the lawsuit.

This time, Su Wenbin is no longer enthusiastic about retrial defences.

The world market is still huge, and they can also open up other markets.

"The whole world knows that the shoemaking industry is a labor-intensive industry. Now the trend of global division of labor is bound to shift the shoemaking industry to many countries and regions where labour force is much cheaper.

This situation is also known to the EU.

Now that we can collect more taxes, why not?

Money can make every day. "

A shoe enterprise external manager think so.

He said last year that his company had drafted an appeal application, but European lawyers told them that there was little hope of tax cuts through review, because the purpose of the EU anti-dumping investigation was to protect their industries, and the other aim was to raise prices, raise taxes and put money in their pockets.

He believes that the EU's tendency to raise its import shoe tax rate will be long-term.

Even Quanzhou entrepreneurs believe that "market economy status and anti-dumping are only a means to achieve the goal of the European Union, which is a" trick "to make money.

The entrepreneur is not optimistic about the outcome of the review.

There are people in the industry who believe that Quanzhou's corporate confrontation debate is not positive. On the one hand, most of Quanzhou's leather shoes enterprises are smaller than Wenzhou and Guangdong. In addition, the larger scale enterprises such as rich birds and Hengtai have no positive defense, and even make them unable to resist discrimination.

China shoes enterprises need to reconsider. As a Chinese shoe enterprise, they also need to recognize the situation in the EU's anti-dumping, and have a clear understanding of their products and the EU market.

Some entrepreneurs think that market economy status and anti-dumping are only a means to achieve the goal of the European Union, and they are a game of making money.

China's shoe enterprises are coping with this trick and have come up with some clever ways.

However, this clever way has made Chinese shoe enterprises suffer a lot.

The Macao leather shoes encountered anti-dumping.

Since October 7, 2006, the EU has imposed an anti-dumping duty of up to 16.5% on China's leather shoes.

In the era of tight trade, the speed of China's shoe products entering the EU has slowed down significantly. In 2007 1-11, the number of exports to the EU was 110 million pairs, which was 6.7% lower than that of the same period last year.

However, with the slowdown in the flow of Chinese shoe products into the EU, the number of leather shoes exported from Macao to Europe has suddenly increased.

As we all know, Macao is not the production base of leather shoes at all. It is easy for the European Union to judge that many shoes are borrowed from other countries and regions to Macao for re export to Europe.

It is clear that in order to circumvent the EU's high tax rate, Chinese enterprises have taken measures to deal with it, among which the "smart measures" include the export to third countries or third places.

Many shoemaking enterprises imported raw materials from China to avoid anti-dumping duties, and then processed factories in Kampuchea, Indonesia and other places; sometimes they did the last step, and then labeled the local label export.

This mode of operation is commonly referred to as "entrepot trade".

But the result of this approach is that Macao has also been included in the scope of anti-dumping on leather shoes by the European Union.

Another common practice of Chinese enterprises is to absorb anti-dumping duties through price cuts.

For example, according to the European Union's decision, the original 10 euro pairs of shoes and footwear importers should pay 2 euros anti-dumping duty on each pair of shoes, so that the import cost of EU importers reached 12 euros.

However, some Chinese shoe manufacturers agreed to reduce the price to 8.3 euro / double in order to allow importers to continue to buy. After the price was cut, the anti-dumping duty imposed by the importers was 20%, or 1.7 euros, which was 8.3 euros, so the total import price was still 10 euros.

This practice is more sensitive to the European Union, because the purpose of European anti-dumping is to raise prices.

In fact, these bypassing and skipping anti-dumping measures are not good because the enterprises using these methods do not really grasp the EU's anti-dumping rules.

The Chinese shoe companies that absorb and evade anti-dumping are likely to be levied on a higher anti-dumping duty in the next review.

If the export prices of Chinese enterprises have declined and the selling prices of imported products in the EU have not changed or enough changes have taken place, then the handle will fall into the hands of the European Union.

In the face of the EU's anti-dumping review, there is an opportunity to take the initiative. It is possible for the enterprises to take the reexamination and investigation to obtain market economy status, and may get a lower tax rate.

Enterprises with no market economy status may get a higher tax rate.

If enterprises with market economy status get a 10% tax rate, enterprises without market economy status will get a 30% tax rate.

Although the trade policy of China and Europe is constantly adjusting, the trade game will not stop. The EU's health and environmental protection standards are getting higher and higher. Chinese shoemaking enterprises should focus more on improving the added value of products and cultivating their own brands: by developing new materials for shoes making, pforming the traditional shoemaking process, and constantly improving the quality of products, making the export of Chinese shoes change from quantitative growth to quality improvement, and enhancing the core competitiveness of enterprises through cultivating their own brands.

This is the most fundamental strategy to deal with EU anti-dumping.