Chinese steelmakers get to their old tricks

President Donald Trump may not have said much about China's steel exports during his recent tour. However, European and American lawmakers are investigating not only simple dumping facts, but also more complex and illegal actions, such as shipping through third parties, in order to hide the origin and avoid pre-existing dumping tariffs.

The European Union Anti-Fraud Office (OLAF) has discovered that Chinese steel has been shipped via Vietnam to evade block tariffs. The current case may be a matter of time.

The posted quantities are considered to be relatively small and the case in question was last year. However, there is strong evidence that China shipped Vietnamese coated steel using Vietnamese certificates of origin and, as a result, avoided anti-dumping duties of approximately € 8.2 million ($ 9.5 million).

Since then, China has shut down some of its excess steel capacity and exports have dropped, but that does not diminish accusations that it is an illegal duty evasion program. Western steelworkers hope similar duties will be applied to Vietnamese steel to close the loophole. This would be quite difficult for legitimate Vietnamese steelmakers, but it may be the only way to prevent the deception from happening again in the future.

The US should respond shortly to whether Chinese steel companies will obey US duties and ship them to Vietnam for minor processing into cold rolled and corrosion resistant steel before selling them to the United States.

By some estimates, it is believed that up to 90% of the value of Vietnamese steel supplied to the US originated in China.