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European industry applauds European Parliament vote against granting China Market Economy Status (MES)

12 May 2016
by AEGIS Europe -- last modified 12 May 2016

With an 83% overwhelming majority, the European Parliament today passed a Resolution against dumping and the granting of MES to China. The Resolution is an important signal that the EU will not grant MES so long as China fails to meet its WTO obligations.


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"With this Resolution, the European Parliament is showing it supports European manufacturers and workers against unfair competition," said Milan Nitzschke, spokesman for the industry association AEGIS Europe. "This is a strong signal to the European Commission and Council that they must not be too hasty in granting China MES," Adding, "The message is clear from the Parliament - we cannot open the EU's market to even more extensive dumping from China, with the consequent destruction of EU jobs and harm to the environment."

The European Parliament also recognized that there is no legal obligation for the EU to grant MES to China automatically, and that the wording of the China's WTO Accession Protocol leaves room for continuing to apply an alternative methodology, one not based on distorted Chinese prices and costs.
 
AEGIS Europe, an alliance of 30 European industrial associations, which promotes manufacturing, investment, employment, growth and innovation in Europe, has long advocated that the EU has no legal obligation to grant MES to China.

In its Resolution, the European Parliament calls on the Commission not to yield to China's demand for MES until China meets the EU's criteria to be considered a genuine market economy. European industry and European trade unions have repeatedly explained that effective action against Chinese dumping is possible only with the use of a non-market economy methodology. The Parliament has underlined this in calling on the Commission to make a proposal, which is not based on the use of the standard methodology, and also urges the Commission to sharpen anti-dumping instruments.

AEGIS Europe calls on the European Commission to turn away from the proposal to grant MES. "The signal from the European Parliament could not be more clear," stated Milan Nitzschke, "MEPs have spoken and they do not agree to a weak compromise, which removes the effectiveness of the anti-dumping instrument. A fair partnership is only possible if China plays by the rules of free and fair international trade, and honours its WTO obligations. So long as China remains a planned economy, which builds up irrational overcapacities, and encourages its industries to dump in foreign markets, Europe cannot grant it MES status. Instead, European anti-dumping defence tools must be strengthened, in compliance with WTO rules."

AEGIS Europe expects a similarly clear position from the Council of EU trade ministers who will meet this Friday and who support the European Parliament's call for the Commission to coordinate with major trading partners, including at G7 level.
 
Last week, German Economy Minister Gabriel asserted that China must not obtain MES until it meets the relevant criteria.

AEGIS Europe brings together nearly 30 European associations representing a broad variety of industries including traditional industries, consumer branches, SMEs and renewable energy sectors, accounting for more than €500 billion in annual turnover and millions of jobs across the EU. This industry alliance, made up of leaders in sustainable manufacturing and social and environmental responsibility, is committed to European manufacturing as the fundamental driver of innovation, growth and jobs in Europe.

AEGIS Europe
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