SME Chamber

GRTU urges Government to vote against further duties of footwear from China & Vietnam

 GRTU has yesterday written to Honorable Ministers Tonio Borg and Tonio Fenech advising not to approve the Commission's proposal of further extending anti-dumping duties on footwear imports from China and Vietnam.

In 2006, during the period when it was discussed whether Malta should vote in favour or against anti-dumping duties on footwear imports from China and Vietnam, GRTU had made it clear that Malta should block this unjust European imposition.

Unfortunately, the authorities decided to ignore our advice and following lengthy political bargaining between Member States, the EU imposed these duties for a period of two years.  When the duties were set to come to an end last year, domestic producers requested an expiry review which is currently under investigation. As a result the duties are still in place and might be extended if the EU gives in to protectionist pressures.

GRTU today retains the same position held in 2006, we are not for protectionist measures, especially were Malta has only to loose. Anti-dumping rules impose duties on imported products deemed to be below cost price, thus making imports more expensive and driving up prices in our stores. In the current crisis, citizens are right to expect the EU to terminate these long-standing measures which artificially ‘protect' the footwear industry. For this specific sector Malta is certainly an importing and not an exporting country, therefore, our retailers and consumers are made to pay extra hefty costs to protect the few foreign European producers. Maltese traders should not have been made to subsidise the few footwear producers still operating in other EU countries.

GRTU also pointed out the following facts:

  • In 2008 Malta imported €604,000 of footwear from China and Vietnam covered by the measures.
  • These imports accounted for around 80% of the volume of Malta's footwear imports from outside the EU. It is highly damaging to place duties on these imports.
  • Measures have had little benefit for EU producers. Overall, the value of Malta's imports from non EU countries were virtually unchanged 2005-2008; declines in imports from China diverted trade to other non EU countries: imports from Indonesia increased 115% and Brazil 13%.
  • Malta's import bill increased by around €72,000 a year as a result of measures. Costs to consumers far outweighed any benefit to domestic producers.
  • The result is that these measures, if extended for a further five years, could cost the Maltese economy at least €390,000.

The reason as to why members are now suffering from this great injustice is because the Maltese Government refused our strong advised to block this unjust imposition. GRTU in no way supported Government in the choice it then made.

The European footwear market has languished for years behind artificial trade protection.  It is now time, as was done in the textiles sector, to open up the market and allow the footwear trade to operate under normal market conditions. Another political compromise extending the duties would in no way encourage European manufacturers to carry out the necessary modernisation. Trade policy must not be ruled by political games: on the contrary, what we need is the abolition of such duties so promoting a truly competitive European industry, injecting momentum into consumer demand and giving the economy the boost it so badly needs.

Government today has given clear indications to the GRTU that it will this time vote against the unfair extra tariffs.

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