European shoe manufacturers were rather confident that the European Union would impose anti-dumping duties on shoes with textile uppers and work boots imported from China, on the strength of evidence that they have been disrupting the European market. An alarming set of data published by the European Commission last Wednesday indicates that the action may be extended to various categories of leather shoes that were previously covered by import quotas, with provisional duties expected already by next October.
Published on the eve of the annual meeting of ANCI, the Italian shoe industry association, and of a negotiating trip to China by Peter Mandelson, the EU trade commissioner, the figures show an overall increase of 713 percent to 38.56 million pairs in the quantities of shoes with leather uppers imported by the EU from China in the first four months of this year, with their average price down by 27 percent to €6.57.
Among the 32 kinds of shoes included in these numbers, high-cut shoes with leather uppers and leather soles (item #6403 51) jumped by 1,315 percent to 243,400 pairs, with the average price down 25 percent to €9.53. Sandals, walking shoes and slippers with leather soles (item #6403 59) recorded a 1,259 percent increase to 1,518,100 pairs, but their average price went up by 38 percent to €8.44. Those with man-made soles, which represent the biggest category (#6403 99), increased by 698 percent to 34.39 million pairs, and their average price went down by 29 percent to €6.28.
Shoes with a plastic or man-made upper (item #6402 99) recorded a 635 percent increase to 110.88 million pairs, with the price down 31 percent to €1.94. For slippers in textile materials (item #64041910), the quantities imported from China were up by 216 percent to 12.48 million pairs and their average price declined by 26 percent to €1.01.
The European Commission reacted immediately with a statement indicating that it would quickly consider any requests from shoe producers for an anti-dumping investigation, adding it to the planned action on T-shirts and linen yarn from China. The textile and apparel lobbies have been more vocal and more successful so far in obtaining the attention of European authorities, but European shoe producers are staging a big rallye to be included into the package of measures and negotiations.
ANCI is organizing a trip by 200 Italian shoemakers to Brussels on June 15. As decided at a meeting of the European confederation of the shoe industry (CEC) in Elche last month, where Spain’s Rafael Calvo was elected as its new chairman, they will join 300 shoemakers from other European countries – mainly Spain and Portugal – in a peaceful demonstration through the streets of the European capital. After that, they will symbolically hand over the keys of their factories to Mandelson on the eve of an important European Council of ministers and heads of state, which is expected to make a political decision on the EU’s trade relations with China, based also on the outcome of his negotiations with Beijing.
The Italian government has promised to put all its weight behind the Italian shoe manufacturers’ cause. Besides the anti-dumping duties, which would follow a preliminary investigation and the examination of further import statistics, it expects quick action on mandatory labels of origin on all the shoes imported in the EU. The reinstatement of certain import quotas on Chinese shoes is another possibility, but not before the beginning of 2006. Moreover, the pressure is on for a major revaluation of the Chinese renmimbi.
Stressing that 8,000 jobs were lost last year in the Italian leather and footwear sectors, while many other workers on temporary layoffs are being subsidized by the Italian government, Rossano Soldini, chairman of ANCI, continued to plead the industry’s cause yesterday, insisting for fair trade rules. Outlining the final Italian trade figures for 2004, he noted that the country’s shoe exports declined by 7.4 percent in volume and by 3.6 percent in value last year, with those in leather down by 6.3 and 3.1 percent, respectively. Italy’s overall shoe imports increased by 15.8 percent in units last year, with those from China up by 27 percent. The average price went down by 8.4 percent. Italy’s exports continued to decline by 10.7 percent during the first two months of 2005, while its imports actually fell by 1.5 percent from the high levels of a year ago.
Officials of the new Footwear Association of Importers and Retail Chains (FAIR), the new lobby that is trying to counter the EU’s action against China, were surprised by the size of the surge in imports from China during the first four months of this year. They said that it could be explained in part by the shift in significant quantities of shipments from the end of 2004 to the beginning of 2005 because of the new quota-free regime. The drop in prices could be partly explained by the drop in the value of the dollar.
Represented in Brussels by Paul Verrips, a former lobbyist of Reebok, FAIR is trying to put together a case against anti-dumping duties and other kinds of safeguard measures, poiinting out that consumers are asking for lower prices and informing its members regularly. It has for the moment 25 members – mostly big importers and retailers from Holland, Belgium and Germany – and it is talking to others about joining the group.