EU imposes new duties on Pakistan plastics

[Lahore_Real_Estate]

BRUSSELS (September 30 2010): The European Union imposed new duties on plastics from Iran, Pakistan and the United Arab Emirates on Wednesday, saying the three were illegally subsidising exports to Europe''s growing soft-drinks market. The decision means Polyethylene terephthalate from Iran, Pakistan and the UAE - used for bottles and food packaging - will face EU import duties of 139.70 euros ($188.1), 44.02 euros and 42.34 euros per tonne respectively until 2015.

"In view of the magnitude of the countervailable subsidies found and in the light of the level of the injury caused to the (European) Union''s industry, it is considered necessary" to launch the new tariffs, the EU''s executive Commission said in the EU''s official journal. The duties are valid for up to five years and reflect Europe''s concern that EU industry is falling behind oil-rich states with competitive and booming plastics markets.

European citizens bought about 100 billion plastic bottles last year - one in five bottles sold world-wide - creating a 3 billion euro ($3.9 billion) market for the plastic. Europe''s decision prompted a senior UAE trade official to warn of disruptions to trade.

"There are many countries that have started to impose certain tariffs to protect their national industry, especially after the (economic) crisis. But this doesn''t serve the interest of trade, we can''t do trade like this," Juma al-Kait, executive director for foreign trade affairs, told Reuters.

Such a decision would adversely affect the UAE''s economy because most of its non-crude oil exports are petrochemical raw materials and feedstocks, including plastics, he said. Plastic bottle makers including Danone and Coca-Cola Group have also warned against the duties.

They are concerned the tariffs will cause EU shortages - struggling EU producers including Spain''s La Seda Group have closed plants, and imports from China, India, Indonesia, South Korea, Malaysia, Taiwan and Thailand already face duties. The European Commission proposed the duties last month and quickly gained majority backing from EU states.

EU states agreed to drop plans for anti-dumping tariffs after the Commission found insufficient evidence of illegal export pricing by companies in Pakistan and the UAE, and no evidence that Iranian price dumping was hurting EU producers.