EU to act against raw material exports curbs

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

29 Sep 2008

The European Union will take measures against countries that have placed a raft of export duties on raw materials, the bloc's trade chief would say on Monday, warning of the dangers of "resource nationalism". To restore free trade in materials such as metals or wood, the EU will use threats of anti-dumping duties and World Trade Organisation negotiations, according to the text of a speech by EU Trade Commissioner Peter Mandelson. "Resource nationalism not only makes this system more politically unstable, it makes it less resource-efficient - which is exactly what we do not need in the face of rising demand," said the text circulated in Brussels.
Mandelson, who is to deliver the speech to representatives of European industry in Brussels, will say there were at least 450 export restrictions on raw materials across the world.
They have been imposed as commodities prices soared in recent years, hurting the EU, which imports 70-80 percent of primary resources.
For example, Russia imposes a 50 percent duty export duty on scrap aluminium that has all but wiped out international trade in this metal, Mandelson said. India taxes iron ore exports at 50 rupees ($1.77) a tonne, which is one reason why its biggest customer, China, is now looking to secure supply in Gabon.
China has imposed an export tax of 120 percent on yellow phosphorous and increased export duties on coke to 40 percent.
Among reasons for such curbs are attempts to shield domestic consumers from high international commodity prices or to capture raw materials for their own producers.
Mandelson warned the 27-nation EU will not hesitate to slap anti-dumping duties on countries that use export restrictions to subsidise local producers and then dump subsidised goods on the European markets.
The EU, the world's biggest trading bloc, will negotiate prohibitions on raw materials restrictions in all ongoing EU free trade agreements and bilateral WTO entry agreements.
"I will raise the question of raw materials in every meeting I have with every trade minister from every country that restricts European imports," Mandelson's speech said.

Source: Reuters