Shoemakers adjust amid EU anti-dumping dispute
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Wang says his company's development history was the result of globalization: "The product lines are imported from Italy, and the shoes are designed in Spain and Italy. I myself am globalized as well. I drive a German car, I wear French cologne, and I use Japanese and U.S.-made home appliances."
But, for the Chinese shoemaking industry at large, he knows that trade protectionism remains a major problem even in the era of globalization.
Trade protectionism in the name of "anti-dumping" has already affected Chinese leather shoemakers, whose exports to Europe have decreased since 2006 when the EU began levying punitive tariffs on Chinese footwear.
Before the EU imposed the anti-dumping measures in 2006, China's leather shoes exports to Europe expanded at an average annual growth rate of 20 percent. That growth ended with the imposition of the duties.
"This kind of trade protectionism does not benefit either side," Wang says. "To do business with Europe, I don't like market practices being intermingled with political factors."
As a whole, China exported about 880 million pairs of leather shoes in 2009. This was down 21.8 percent from a year earlier, as the global economic slowdown and rising protectionism measures impacted, the China Leather Industry Association said.
Brazil and Argentina followed the EU, launching an anti-dumping investigation into Chinese-made shoes last year. All this means is that doing business with other countries is getting tougher for businesses in Wenzhou, the country's footwear manufacturing base.
The city of Wenzhou is home to nearly 3,000 shoemaking companies. They exported 2.75 billion U.S. dollars worth of shoes in 2009. According to the city government, that is up 0.06 percent from 2008.
Zhou Yaohua, an assembly line technical supervisor at Wenzhou-based Dongyi Shoes Co. Ltd., feels the change with rising anti-dumping investigations targeted Chinese-made shoes.
To a shoemaking worker like Zhou, the EU's anti-dumping measures on Chinese-made footwear means less income and fewer shoe orders.
"Four fifths of the foreign orders our company receives this year are for low-end leatherette shoes, compared with 75 percent for high-end genuine leather shoes in previous years," says Zhou.
He says the added value of a pair of high-end genuine leather shoes at Wenzhou's shoemaking companies ranges between 25 to 30 U.S. dollars, greatly out-pacing the amount of low-end leatherette shoes, at seven to eight U.S. dollars per pair.
"If our assembly line manufactures genuine leather shoes, I can earn between 3,000 yuan (439 U.S. dollars) and 3,500 yuan (512 U.S. dollars) a month," says Zhou.
Sporting a casual suit, he points to several still assembly lines inside a bright and spacious building in northeastern Wenzhou. "At our peak, all the 12 assembly lines were opened at full speed with more than 3,000 workers busy cutting leather, stitching up soles and shining the uppers."
Zhou has been working in the city's shoemaker industry since he graduated from high school. He says, "I have been in this business for more than 20 years, so I know how manufacturing thrives here. Our city started from nothing in the 1980s. We failed once and we learned. Now we finally have our own brands."
However, the increase in anti-dumping tariffs and investigations into Chinese-made shoes, may put a halt to the city's shoemaking and other manufacturing industries.
"The EU countries just took advantage of the concept 'anti-dumping' to set very high threshold for imports of both inexpensive and fine Chinese products," he says.
Zhou is uncertain about the future of China's shoe industry.
