KARACHI: The government’s efforts to have duty on Polyethylene Terephthalate (PET) by European Union (EU) removed appear to be collapsing with the latest move of EU by proposing duty of 42-44 euros per tonne on import of plastic from Pakistan along with Iran and United Arab Emirates (UAE).

According to latest news reports, the EU believes these countries provide subsidies to exports, supplying plastic for Europe’s growing soft-drinks market. The government took up the issue of duty to remove the reservations of EU about the export of PET to its member countries to ward off the possible countervailing duty. However, the latest move of EU suggested that all these efforts to refrain EU from imposing this duty has been fallen apart since EU is seriously considering to re-impose this duty on Pakistan and the other two nations.

The European Commission (EC) started anti-dumping investigation into alleged cut-priced exports of PET to the EU from Pakistan along with Iran and the UAE some time back.

In an effort to obviate the imposition of CVD, the Ministry of Commerce (MoC) and National Tariff Commission (NTC) had been consulting with EU for quite some time.

PET - commonly known as plastic bottle material – is a key product exported to the EU apart from traditional items like textile and clothing and according to estimates, EU consumes around $200 million worth of PET from Pakistan, which is supplied by a company based only in Pakistan.

EC started probe in September last year and according to the commission, it started investigation complaints from the PET Committee of Plastics Europe alleging that imports of certain PET, originating in Iran, Pakistan and the UAE are being dumped and are thereby causing material injury to the EU industry. The commission said the committee had evidence PET imports from these countries have increased overall in absolute terms and in terms of market share. Also, given the volumes and the low prices concerned, there has been a negative impact on the market share held and prices charged by the EU industry, resulting in adverse effects on its financial situation, causing significant job losses. The commission also gathered company’s production costs and sales data from producers in Iran, Pakistan and the UAE, looking at trading information from July 1, 2008, to June 30, 2009.

According to officials in the Ministry of Commerce, EC is particularly concerned about its domestic PET manufacturing industry, which allegedly suffered from the huge imported subsidised PET from Pakistan. As far as Pakistan PET is concerned, officials said, European PET manufactures contend that Pakistani PET is being subsidised, which makes it competitive in the European market and adversely impacts the competition in the market.

By Tanveer Ahmed

Friday, August 06

Source: www.dailytimes.com.pk