Regarding anti-dumping accusations, the EU assesses that there are differences in the price of stainless steel cold-rolled flats that are exported at normal prices.
By
SYAHNAN RANGKUTI
·4 minutes read
LUKAS - BIRO PERS SEKRETARIAT PRESIDEN
President Joko Widodo delivers remarks at the inauguration of PT Krakatau Steel's Hot Strip Mill #2 in Cilegon City, Banten Province, Tuesday 21 September 2021..
JAKARTA, KOMPAS — Indonesia and the European Union are in a battle at the World Trade Organization again. This time it is not a matter of nickel and crude palm oil but one of cold-rolled flat stainless steel. This follows Indonesia's request for consultation with the WTO on the imposition of balancing duties and anti-dumping of cold-rolled flat stainless steel by the European Union.
On 15 March, 2022, the EU Commission imposed a balancing import duty (BMP) or countervailing duty on Stainless Steel Cold-Rolled Flat (SSCRF) imports from India and Indonesia. The BMP imposed on Indonesia is 21 percent while India is 7.5 percent.
In November 2021, the EU imposed an anti-dumping import duty (BMAD) on the product of 10.2 to 35.3 percent in Indonesia and India, bringing the total BMP and BMAD levied on Indonesia to 31.5 to 56.3 percent.
Indonesia and the EU met to discuss the issue several times last year and earlier this year. In the last communication with the EU on 24 Jan., 2023, Indonesia decided to bring the case to the WTO Dispute Settlement Agency (DSB).
Two days later, the WTO published a consultation request for all members as the initial stage of discussion at the DSB level. This is stated in a WTO notification dated 26 Jan., 2023.
Director general of international trade negotiations at the Trade Ministry, Djatmiko Bris Witjaksono, said on Monday that Indonesia had submitted a request for a consultation on the imposition of BMP and BMAD on cold-rolled stainless steel at the WTO. This is in order to protect the industry from EU trading barriers.
"The imposition of BMP and BMAD on the product by the EU is also not in line with the provisions of the WTO," he said.
KOMPAS/IWAN SETIYAWAN
A worker oversees a metal smelting furnace at PT Krakatau Posco's production facility in the Krakatau Steel Industrial Estate in Cilegon, Banten, Wednesday (26/11/2014). This steel plant has a production capacity of 3 million tons per year.
In the WTO notification letter, there are five points of Indonesia's objections against the EU accusations regarding subsidies and one point related to dumping. Indonesia assessed that the imposition of BMP and BMAD was not in line with the agreement of subsidized and balancing actions (SCM Agreement) and the 1994 WTO General Tariff and Trade Agreement (GATT).
Regarding the subsidy accusation, two points of the Indonesian objection were regarding the granting of the Chinese government funds for certain companies to develop the iron industry in Indonesia and the supply of nickel ore to an iron-steel company. Indonesia assessed that the EU accusation of subsidies for certain companies did not show the necessary specificity required in the SCM agreements.
In Article 1.1 of the agreements, for example, a subsidy is considered to exist if there is a form of income or price support for the product based on Article XVI of the 1994 GATT. Meanwhile, related to the provision of nickel ore for iron-steel companies, Indonesia has asked the EU to prove its accusations specifically and clearly according to Article 1.2, 2.1, 2.2 and 2.4 of the SCM agreement.
Regarding anti-dumping accusations, the EU assesses that there are differences in the price of stainless steel cold-rolled flats that are exported at normal prices. Indonesia maintains that the EU uses its own formula for the calculation and does not refer to Article 2.4 of the Anti-Dumping Agreement. In that article it is stated, price comparisons must be carried out at the same trading level, namely at the factory level and in connection with the sale as close as possible at the same time.
EU condition
From January to August 2022, EU steel exports fell 17 percent and imports grew 8 percent. The director general of the European Steel Association (Eurofer), Axel Eggert, said the cost of steel industry production in the EU rose due to skyrocketing energy prices. Steel production and exports fell, while imports were still relatively high.
"If an emergency action that reflects the critical situation of some critical industries in Europe is not taken, we are at risk of significant industrial capacity destruction," he said in a press release.
By looking at this condition, Eurofer supported the steps of the EU commission to implement BMP and BMAD to protect the domestic steel industry. (HEN)
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