Nine Latin American steel associations urged Ibero-American countries meeting at the Ibero-American Summit of Heads of State and Government, held in Cartagena, Colombia, from October 27-28, not to accept China as a market economy.
The letter was made available to the press during the Alacero conference, held in Rio, Brazil, this week.
Steel associations from Brazil, Argentina, Mexico, Chile, Peru, Ecuador, Dominican Republic, Colombia, along with Alacero, the region’s steel association, said their major concern is the loss of jobs, and its impact in the local communities, as well as the shutdown of companies and the potential disincentive to investments that could occur as a result of the recognition of China as a market economy.
Earlier this week, Brazil’s steel association, IABr, said such recognition should bring adverse effects for the nation’s steel sector, which could lose over 30,000 job positions by 2020.
The joint letter sent this week proposed the establishing of a global forum to fight the issues of China’s overcapacity and unfair trade.
Justifying their arguments, the local steel associations noted, among other points, that China doesn’t respect international trade rules within the steel sector and that its unfair trade practices were punished by over 280 AD duties applied by countries that are members of the World Trade Organization (WTO).
Additionally, the letter stated that China’s state-run companies should operate under commercial and market conditions that are similar to that of Latin American companies.
The letter also recognized that Chinese mills receive “multiple subsides and unlimited financial support from the Chinese government.”
The letter proposed, among a number of other items, that the region’s countries should defend their industries from unfair trade, at the same time guaranteeing isonomy before China.
The Ibero-American Summit of Heads of State and Government involves 22 countries that make up the Ibero-American community, including 19 Spanish- and Portuguese-speaking nations in Latin America and those of the Iberian Peninsula, such as Spain, Portugal and Andorra.