Anti-dumping actions on the rise

Let me first of all get in an 'I told you so'.

Anti-dumping complaints are counter-cyclical. Invariably, the numbers rise, with a lag, as industrial output slumps. We've seen declining levels up to 2007 but now… WTO is reporting a 27% year-on-year rise in the number of investigations.

"The Members reporting the highest number of new initiations during July-December 2008 were India, reporting 42, followed by Brazil, reporting 16, China (11), Turkey (10), Argentina and the European Communities (9 each), Indonesia (6), Ukraine (4), Pakistan and the United States (3), Australia and Colombia (2 each), and Canada, Korea and Mexico (1 each)." Extract from WTO Press Release

This development only makes the current Productivity Commission enquiry all the more relevant, because you can bet it won't be long before the Australian government will be pressed to scratch harder at the anti-dumper's itch.

It's a mark of industrial development (no, really)—or perhaps of the development of their political economies—that the charge is now being led by the emerging industrial giants (India, China, Brazil) whose exports are also the most anti-dumped. Tit-for-tat protection? Perhaps. But if that were so, then China would be taking a much bigger lead on anti-dumping actions than it has so far; it is certainly the hardest-hit (click thumbnail image).

In reality dumping is a rational, competitive commercial strategy. Anti-dumping is an effective strategy too, although anti-competitive. Protectionism is measured in this case not by anti-dumping investigations but by the willingness of governments to impose anti-dumping penalty duties, in effect on their own consumers, that are often many times higher than bound tariff rates.

Tags for this entry: wto protection recession anti-dumping