Another Wrinkle in EU-China Relations: Ironing Boards

(Bloomberg) --

Given the Western world’s growing unease about the high-tech challenge posed by China, it’s easy to forget just how extensive the jitters remain about low-tech goods.

The European Union offered a reminder this week by renewing 12-year-old trade protection against China that targets the most mundane of household items: ironing boards. The bloc reimposed tariffs as high as 42.3% for five more years.

The goal is to protect producers in EU countries including Italy and Poland from alleged below-cost — or “dumped” — imports. The European manufacturers, which number 10, are hardly household names; Colombo New Scal and Rorets Polska Spolka are two.

Ironing boards are among a group of more than 50 Chinese products subject to EU anti-dumping duties, making China by far the most frequent target of such European levies. Other Chinese goods that face such import taxes include aluminum foil, ceramic tiles, ring binders and tableware.

Low-tech goods can be a source of fairly high-level frictions between China and the EU. China has a particular gripe about European anti-dumping duties on Chinese bicycles because they’ve been in force since 1993. That didn’t stop the EU from reimposing the levies in August for five more years (or from applying similar five-year duties on Chinese electric bikes for the first time in January).

In the case of ironing boards, the EU said longer anti-dumping measures against China are needed to guard against financial risks to a European industry that makes 5.2 million boards a year and employs fewer than 700 people in total.

Not even the U.K.’s plan to leave the EU on Oct. 31 affected the reasoning of the bloc, which included a British maker of ironing boards — Vale Mill — among a list of three European producers that received “verification visits” during a probe to determine whether the duties should be prolonged.

Charting the Trade War

Donald Trump’s administration is preparing to impose tariffs on European exports ranging from wine and spirits to cheese and airplanes, after the World Trade Organization authorized $7.5 billion in U.S. duties against the EU. This would deliver a serious blow to Europe’s aircraft industry and hit export orders for U.S. manufacturers, according to analysis by Bloomberg Economics.

Today’s Must Reads

• Butter battle | U.S. consumers, never shy about loading on the butter, have been buying growing amounts of Irish dairy products. A new round of U.S. tariffs may stall that momentum.
• Brexit Plan B | Boris Johnson is trying to reach a Brexit deal, but his effort at compromise looks too tough for the EU to stomach. His Plan B is to keep the Irish backstop, with one crucial condition: that the EU puts a clear time limit on it.
• South Africa-Nigeria ties | The two nations signed dozens of accords that will enable South Africa to tap West African markets. They’ll also boost Nigeria’s efforts to diversify its oil-dependent economy.
• Cabinet charge | The U.S. Commerce Department slapped more duties on wooden cabinets and vanities from China in a sign of the challenges awaiting negotiations when the two countries resume trade talks next week.
• Malaysian slump | Malaysian imports fell by the most since 2009 in August as demand for capital goods waned, suggesting the nation’s economic growth will cool in the months ahead.

Economic Analysis

• Spreading beyond industry | The latest non-manufacturing ISM suggests that service-sector confidence and employment are not immune to the impact of the trade war, and will amplify pressure on the Federal Reserve to provide more support.
• Steel protest | U.S. steel importers made their case why the law giving President Trump the authority to restrict imports in the name of national security is unconstitutional.

Coming Up

• Oct. 8: Japanese, South Korean, French trade balance
• Oct. 10: German, U.K. trade balance
• Oct. 10-11: U.S.-China talks in Washington

To contact the editor responsible for this story: Zoe Schneeweiss at zschneeweiss@bloomberg.net, Fergal O'Brien

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