As the US raises steep new tariffs, South Africa and Europe brace for a surge of dumped Chinese goods diverted from American markets, raising fears of damage to local industries.
There are fears in Europe, South Africa and probably around the world that the tariff wall President Trump is erecting around the United States will result in goods being diverted to other markets at dumped prices.
European countries fear that the high tariffs being imposed on Chinese imports into the United States could result in higher shipments of these goods to the European Union.
The New York Times reports that China produces a vast array of artificially cheap goods — heavily subsidised electric vehicles, consumer electronics, toys, commercial grade steel and more.
Much of that trade was destined for the endlessly voracious American marketplace.
“With many of those goods now facing an extraordinary wall of tariffs thanks to President Trump, fear is rising that more products will be dumped in Europe, weakening local industries in France, Germany, Italy and the rest of the European Union,” the newspaper said.
Ursula von der Leyen, the president of the European Commission, had promised to “engage constructively” with China even as she has warned about the “indirect effects” of the American tariffs and has vowed to closely watch the flow of Chinese goods.
A new EU task force will monitor imports for signs of dumping.
“We cannot absorb global overcapacity nor will we accept dumping on our market,” Ms. von der Leyen said as the Trump tariffs went into effect.
Similar fears are being expressed in South Africa. The country needed to protect its domestic markets, said Renai Moothilal, executive director of the National Association of Automotive Component and Allied Manufacturers (Naacam).
“Most countries around the world are currently looking for alternative markets to replace the US. This poses a risk of increased product dumping and South Africa should be cognisant of this,” he told Engineering News.
In the Daily Investor, trade law expert Dr Gustav Brink noted the tariff threat to South Africa’s agricultural and automotive sectors, but said other industries could be hard hit by new Chinese imports.
As the United States closes its doors to China, South African industries may face a lot of import competition from Chinese exporters looking for other markets, and this could close down many of South Africa’s manufacturing industries, he said.
