Steel imports from China increased 65 percent in 2013-2014, posing a threat to the industry in the region, the Latin American Steel Association, known as Alacero, says.
"Our main concern is that these imports arrive under conditions of unfair competition that can be observed in the average price of Chinese products coming to Latin America, which is 14 percent lower than prices for the rest of the world," Alacero president Rafael Rubio said in a statement released Tuesday.
The situation is even worse in Central America, where the average price of Chinese steel imports is 20 percent below world prices, he said.
"Latin American steelmakers are able to compete with Chinese companies under fair terms, but not when these companies have unlimited financial support from their government, which is the majority owner of those enterprises," Rubio said.
Besides benefiting from subsidies, China's state companies resort to tactics such as dumping - selling below cost - to grab market share from domestic producers in export-destination countries, according to Rubio.
The Chinese government gives its companies an unfair advantage by supplying necessary infrastructure at no cost to the firms and providing subsidies in the form of below-market prices for inputs such as electricity and coal, the Alacero leader said.
Additionally, Rubio said, China's government keeps the country's currency undervalued to boost exports.
"To summarize: private sector companies cannot compete with a government and its firms, as in the case of the Chinese steel industry," Rubio said. EFE
Source: foxnews.com
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