Posted on 05 Jun 2015
This week, the Ministry of Economy of Guatemala published Resolution 583, which decides not to impose anti-dumping measures on imports of galvanized steel from China. The investigation of these products was requested by Ternium Internacional Guatemala, SA in December 2013 and was launched on March 5, 2014.
This resolution leaves an open flank in the region for the entry of subsidized products and dumping, and is stated in a way that differs from the decisions made by other governments in the region and the world favoring competition and supporting the international rules of the WTO.
The problem of steel imports from China is serious and affects the great majority of countries in the region.
Currently, in Latin America, there are 24 resolutions in force against steel imports from China and other 12 investigations in process.
Chinese steel companies shipping steel to Guatemala do not operate under market conditions. They are managed and subsidized directly by the government, which allows them to operate at margins economically unsustainable for any private enterprise. The indiscriminate imports of these products at dumped prices are threatening the competitiveness and thousands of jobs in Latin America.
“Not recognizing the damage that Chinese imports are causing to the production plants in Guatemala, could jeopardize more than 250 direct jobs in Guatemala, more than 350 in Central America and more than 1,200 indirect jobs, with annual salaries of more than 50 million quetzales.”- said Sebastian Castro, Director of Ternium in Central America.
On the other hand, some governments are becoming increasingly aware of the danger of Chinese imports. As an example, Mexico has already implemented 13 definitive antidumping measures between 15% -99%. Furthermore, the day the government of Guatemala declared that there was no dumping by China, the US government initiated an investigation against China for unfair trade in the same products, demonstrating dumping of 120%.
Once again, Alacero calls every country in Latin America to implement -effectively and immediately- the defense mechanisms authorized by the World Trade Organization (WTO) to stop the spread of unfair competition, since local private companies cannot confront the unfair competition of the Chinese government and the steel companies it owns.
