EU agrees tariffs on Chinese, Vietnamese shoes

Malta yesterday abstained during a vote taken on a proposal to introduce new customs tariffs on leather shoes imported into the EU from China and Vietnam.

The vote followed an investigation which found that the two Asian states were heavily subsidising their industries and that this was resulting in a flood of cheap leather shoes in the European market at below production prices.

A majority of EU governments backed a compromise plan put forward by the Finnish presidency of the EU to impose tariffs of up to 16.5 per cent on Chinese shoes and 10 per cent on shoes imported from Vietnam. The levies they had temporarily decided to impose six months ago were harsher.

Malta, represented at the meeting in Brussels by its permanent representative to the EU, Richard Cachia Caruana, decided to reconfirm its abstention, already submitted in preliminary technical meetings on this issue. This was in spite of pressure exerted by the GRTU last week to force Malta to change its position and vote against.

In a press conference, GRTU officials and shoe importers had criticised the government for not opposing the proposed tariffs and charged that, if enforced, they would increase prices for consumers and might also result in job losses.

However, a government spokesman yesterday justified Malta's decision and dismissed the GRTU's arguments. He said that Malta, as a member of the EU, had an obligation to make sure that the free market was functioning properly and that no state subsidies are given to industries in order to outperform competition. Although Malta had no shoe industry, it felt it couldn't oppose the tariffs, as part of its EU obligations.

It abstained instead of voting in favour because of some minor technical issues which it wasn't completely in favour of, the spokesman said.

Sources close to the Customs department said the new tariffs should not have any effect on the Maltese retail market, as the importation of such shoes was still very low.

In 2005, only Lm200,000 worth of shoes were imported from China and Vietnam. Not all of them fell into the category where levies are imposed. The situation in Europe is quite different: China supplied half of the 2.5 billion pairs of shoes sold in Europe last year.