Following tense discussions, an expiry review of the anti-dumping measures applicable to leather shoes from mainland China and Vietnam was finally initiated on 3 October 2008 (for more details concerning the initiation of the expiry review, see the Anti-dumping actions section of this issue of Business Alert-EU).
Hong Kong traders will certainly recall that the review investigation was opened despite the opposition of a majority of EU Member States. However, European shoemakers convinced Commissioner Mandelson of the need to conduct a review investigation. They argued that the Commission was obliged to initiate the review procedure under EU law based on evidence presented in their complaint. That said, traders should take some comfort from the fact that the Commission has made a statement that it will make every effort to complete the review as expeditiously as possible (see Business Alert-EU, Issues 19 and 20/2008).
It seems that this was to be the last big decision of Peter Mandelson as a member of the top European executive body. Almost symbolically, on the date of publication of the notice of initiation of the expiry review, it was announced that Mr. Mandelson would return to the British government. Ms. Catherine Ashton, Baroness Ashton of Upholland has been named as Mandelson's successor.
The news has drawn mixed reactions. Hong Kong traders are no doubt aware that Mandelson is a well-known proponent of free trade. During his term, the Commission's Directorate-General for trade developed a proactive strategy in relation to bilateral trade agreements with a number of partners. Furthermore, the former Trade Commissioner was pushing for a quick conclusion to the WTO Doha talks. He was also praised by the supporters of free trade and by European importers for his liberal approach with respect to anti-dumping and other trade measures. Baroness Ashton will have a hard act to follow in this respect.
As regards free trade negotiations, the sudden replacement of the Trade Commissioner raises concerns that these could be slowed down. In particular, the negotiations regarding the FTA with South Korea seem to be in danger. The new Commissioner will be fully appointed after having received the formal approval of the European Parliament, which is scheduled to take place in November this year. Until then, it is not clear whether the future Commissioner will have the power to represent the Commission at summits with third countries. Therefore, Baroness Ashton may have to skip a series of important trade summits, including one with South Korea which is scheduled to take place on 25 October 2008. This may have a knock-on effect on negotiations on the EU-Korea FTA. Indeed, these negotiations are in the final stage and ministerial engagement is needed to solve the outstanding issues with serious political implications. Trading partners will also have to establish new personal links with Baroness Ashton.
However, it seems that the future Commissioner will first be focussing on informal meetings with Members of the European Parliament in order to dispel concerns about her competence in the area of trade policy, and doubts about her ability to deal with trade partners.
The sudden departure of Mr. Mandelson also raises questions regarding the future development of WTO Doha talks. Indeed, while the former Trade Commissioner was a known supporter of the further liberalisation of world trade, the position of Baroness Ashton on this issue remains unknown. It is also not clear whether she will have the negotiating muscle to push through her trade agenda with other EU Commissioners and EU Member States. It has also been debated whether she is properly qualified to defend the EU's position when faced with experienced representatives from other trade partners during the WTO negotiations.
It remains to be seen what the new Commissioner's approach will be to anti-dumping policy and other trade defence policy activities. It is well known that Mr. Mandelson tried hard to reform this area. Indeed, his aim was to put more emphasis on the "Community interest" aspect of investigations, which should consider not only interests of European producers, but also interests of other traders, users and consumers. The new approach was considered to better correspond to the needs of the EU in a twenty-first century global economy. However, the planned reform had to be dropped following heavy opposition from some particularly hard-headed EU Member States. Regular readers of Business Alert-EU will certainly recall that attempts by Mandelson's administration to apply these new ideas to a number of individual anti-dumping cases was largely unsuccessful (as documented, for example, in the anti-dumping case regarding air compressors, see Business Alert-EU, Issues 5 and 6/2008).
This fact only adds fuel to the fire of the push-me-pull-you politics of trade liberalisation in the EU, and market watchers will be scrutinising Baroness Ashton's actions to assess the direction in which she will be leading European trade policy in the coming months. The new Trade Commissioner will have plenty of opportunities to show whether she leans towards the European protectionist manufacturers or the free-trade oriented traders.
In the week of 13 October 2008, she may already be called upon to consider whether or not to propose the imposition of definitive anti-dumping duties on imports of citric acid from mainland China and provisional duties on certain PSC wires and strands, also from mainland China. The Commission and the national trade experts are furthermore due to discuss the controversial issue of whether or not to impose provisional duties on imports of candles from mainland China and whether or not to grant leniency to two mainland Chinese candle makers. What is more or less certain is that Hong Kong traders will soon get a feel for which way European trade policy will lean, under the new Commissioner.
Hong Kong traders will certainly recall that the review investigation was opened despite the opposition of a majority of EU Member States. However, European shoemakers convinced Commissioner Mandelson of the need to conduct a review investigation. They argued that the Commission was obliged to initiate the review procedure under EU law based on evidence presented in their complaint. That said, traders should take some comfort from the fact that the Commission has made a statement that it will make every effort to complete the review as expeditiously as possible (see Business Alert-EU, Issues 19 and 20/2008).
It seems that this was to be the last big decision of Peter Mandelson as a member of the top European executive body. Almost symbolically, on the date of publication of the notice of initiation of the expiry review, it was announced that Mr. Mandelson would return to the British government. Ms. Catherine Ashton, Baroness Ashton of Upholland has been named as Mandelson's successor.
The news has drawn mixed reactions. Hong Kong traders are no doubt aware that Mandelson is a well-known proponent of free trade. During his term, the Commission's Directorate-General for trade developed a proactive strategy in relation to bilateral trade agreements with a number of partners. Furthermore, the former Trade Commissioner was pushing for a quick conclusion to the WTO Doha talks. He was also praised by the supporters of free trade and by European importers for his liberal approach with respect to anti-dumping and other trade measures. Baroness Ashton will have a hard act to follow in this respect.
As regards free trade negotiations, the sudden replacement of the Trade Commissioner raises concerns that these could be slowed down. In particular, the negotiations regarding the FTA with South Korea seem to be in danger. The new Commissioner will be fully appointed after having received the formal approval of the European Parliament, which is scheduled to take place in November this year. Until then, it is not clear whether the future Commissioner will have the power to represent the Commission at summits with third countries. Therefore, Baroness Ashton may have to skip a series of important trade summits, including one with South Korea which is scheduled to take place on 25 October 2008. This may have a knock-on effect on negotiations on the EU-Korea FTA. Indeed, these negotiations are in the final stage and ministerial engagement is needed to solve the outstanding issues with serious political implications. Trading partners will also have to establish new personal links with Baroness Ashton.
However, it seems that the future Commissioner will first be focussing on informal meetings with Members of the European Parliament in order to dispel concerns about her competence in the area of trade policy, and doubts about her ability to deal with trade partners.
The sudden departure of Mr. Mandelson also raises questions regarding the future development of WTO Doha talks. Indeed, while the former Trade Commissioner was a known supporter of the further liberalisation of world trade, the position of Baroness Ashton on this issue remains unknown. It is also not clear whether she will have the negotiating muscle to push through her trade agenda with other EU Commissioners and EU Member States. It has also been debated whether she is properly qualified to defend the EU's position when faced with experienced representatives from other trade partners during the WTO negotiations.
It remains to be seen what the new Commissioner's approach will be to anti-dumping policy and other trade defence policy activities. It is well known that Mr. Mandelson tried hard to reform this area. Indeed, his aim was to put more emphasis on the "Community interest" aspect of investigations, which should consider not only interests of European producers, but also interests of other traders, users and consumers. The new approach was considered to better correspond to the needs of the EU in a twenty-first century global economy. However, the planned reform had to be dropped following heavy opposition from some particularly hard-headed EU Member States. Regular readers of Business Alert-EU will certainly recall that attempts by Mandelson's administration to apply these new ideas to a number of individual anti-dumping cases was largely unsuccessful (as documented, for example, in the anti-dumping case regarding air compressors, see Business Alert-EU, Issues 5 and 6/2008).
This fact only adds fuel to the fire of the push-me-pull-you politics of trade liberalisation in the EU, and market watchers will be scrutinising Baroness Ashton's actions to assess the direction in which she will be leading European trade policy in the coming months. The new Trade Commissioner will have plenty of opportunities to show whether she leans towards the European protectionist manufacturers or the free-trade oriented traders.
In the week of 13 October 2008, she may already be called upon to consider whether or not to propose the imposition of definitive anti-dumping duties on imports of citric acid from mainland China and provisional duties on certain PSC wires and strands, also from mainland China. The Commission and the national trade experts are furthermore due to discuss the controversial issue of whether or not to impose provisional duties on imports of candles from mainland China and whether or not to grant leniency to two mainland Chinese candle makers. What is more or less certain is that Hong Kong traders will soon get a feel for which way European trade policy will lean, under the new Commissioner.
