Robert Sturdy

2 July 2009

Conservative Euro-MP Robert Sturdy has criticised China for its export restrictions on a number of key raw materials which could force businesses in the EU which rely on them to suffer financially or even close down.

Mr Sturdy, who has played a key role in international trade talks and has co-chaired the WTO Committee, has accused China of tit-for-tat actions for its response to the “Buy American” clause which the United States was later forced to retract.

Mr Sturdy says that China’s protectionist actions were clearly in breach of international trade rules and he supports a request from the EU for urgent WTO consultations with China to end the restrictions.

The products concerned include phosphorous, magnesium, silicon metal, zinc, coke and bauxite and are used by the steel, aluminium and chemical industries, representing about 4% of EU industrial activity and around 500,000 jobs.

China has recently announced it will abolish some export duties on grains and industrial products and cut the duties for chemical fertilizers and nonferrous metals from today. However, the list does not include key raw materials for European industry.

Mr Sturdy said: “Protectionism is never the answer. As markets, industries and businesses look for ways out of the recession, we have an obligation to ensure the free movement of goods and services.

“High rate export and import duties may benefit China right now, but the cost is felt all the way through the supply chain and could severely affect the financial viability of businesses in the EU which rely on their raw materials.

“Raw materials are volatile commodities at the best of times and China’s actions could severely distort the market and create an unlevel playing field, making it near impossible for European industries to compete.

“The United States quite rightly was forced to reconsider its protectionist “Buy American” clause in its stimulus package earlier this year. But China’s tit-for-tat approach is totally unacceptable.

“China is a booming economy and must demonstrate its respect for  the global market and opportunities within the WTO. Only through working together – and not against one another – can we hope to recover from this economic crisis and build stronger political will which will enable us to secure a crucial deal on DOHA.”

ENDS