NZ Steel Confirms Concerns Over Dumping Of Cheap Chinese Steel

18 August 2016

New Zealand's biggest steel company fears cheap Chinese product is being dumped here but says it cannot officially confirm if it has lodged a complaint over the issue.

Speaking after giving evidence to the commerce committee on Wednesday, the boss of Pacific Steel and sister company NZ Steel Robin Davies said: "We are concerned about steel dumping and subsidised steel, as are all steel makers globally."

Most countries had sought remedies for trade dumping and countervailing duties on steel.

"New Zealand is about the only country that hasn't."

He said there was "a massive oversupply from China that has driven that process and we are very concerned from a New Zealand steel view that there is steel dumping and subsidised steel at this time, in a general sense".

Stuff reported last month that Chinese officials had warned New Zealand exporters they may face trade reprisals as a result of the anti-dumping complaint.

Officials here are yet to decide if an investigation will be launched into Pacific Steel's complaint, but World Trade organisation rules prevent any official confirmation of the complaint until an investigation is launched - though the Government was obliged to advise China it had been lodged.

Meanwhile Trade Minister Todd McClay on Thursday again refused to say what had prompted fears on May 25 of trade reprisals by China, or who raised those fears.

They led the Government to seek assurances from China that there would be no trade retaliation.

The committee is considering whether a "public interest test" should be added to the current anti-dumping law which would allow the minister of commerce to override any duties imposed as a result of a dumping complaint.

Davies said the principles of the WTO in respect to dumping were black and white, whereas a public interest test was another hurdle or subjective test local suppliers would have to navigate.

"It goes against WTO rules in that sense."

Labour trade spokesman David Clark said the public interest test was too uncertain and created a "double jeopardy" for local complainants.

"If they win an anti-dumping complaint the minister can override that with a public interest test."

Of 168 members of the WTO only 10 had adopted a public interest test.

He also questioned why the anti-dumping amendment bill was introduced just two weeks after the Government "went into a flap on May 25 over possible trade retaliation" though officials had been working on it since mid 2015.

Under the proposal the commerce minister would need to consider price, product choice and availability, quality, the financial viability of the domestic industry, employment and competition but the weight given to each was not clear, Clark said.

"It's a complete blancmange."

He was also concerned that, despite assurances to the contrary, the impact of China's trade retaliation could be taken into account in the public interest test.

"As the test has been outlined to us ... trade issue will not be taken into account. However it's very hard to know how decisions will be reached. Businesses' financial viability for instance; presumably that relates directly to trade issues."

The minister would be in a position to weigh the wider public interest and could be accused of screwing the scrum or undermining a trade relationship.

Clark said it was possible the complaint by Pacific Steel would still be under consideration when the public interest test was introduced, potentially harming Pacific Steel.

"You won, but you lose."

Davies said if a dumping complaint was lodged it could take at least nine months to resolve, while Australia had adopted a more streamlined process.

"If there's injury being sustained then the injury is continuing being sustained while that review process is underway."
Most exporters and manufacturers had opposed the public interest test in submissions to the committee, but the views of local retailers were mixed.


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