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Expert warns Brazil against protectionism

By Song Shengxia  (Global Times)

08:16, July 06, 2012

Brazil's mounting protectionism against China could backfire as it might undermine the trade between the two BRICs nations and also dampen the latter's enthusiasm to invest in Brazil, trade experts said Thursday.

"Under the current global economic slowdown, many countries are resorting to protectionism," Bai Ming, a researcher with the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce, told the Global Times.

The tendency has spread to emerging countries, such as Brazil, which have similar industrial structure with China and can compete with China in many labor-intensive sectors," Bai said.

The protectionist practices will not only impact the bilateral trade but also China's interest in investing overseas, he said.

Brazil's trade regulatory body Camex voted Wednesday to slap up to 182 percent anti-dumping duties on unfinished shoe products including footwear upper and sole imported from China, the People's Daily Online reported.

The South American country has already introduced an anti-dumping tariff of $13.85 on each pair of shoes from China since 2010.

The anti-dumping investigation into Chinese shoe materials was filed by the Abicalçados (Brazilian Footwear Industries Association) in 2011.

The investigation found that shoe materials imported from China accounted for more than 60 percent of raw materials used for producing shoes in Brazil, and the added value during the production was lower than 25 percent, the report said.

The Ministry of Commerce (MOFCOM) did not comment on the case by press time on Thursday.

Lin Feng, director of the Secretariat Office of China Shoes Association, told the Global Times that Brazil's move will further affect sales of Chinese shoemakers who have already seen a decline in overseas orders due to the eurozone debt crisis and slow recovery of the US economy since the beginning of the year.

Brazil imported a total of 15 million pairs of shoes worth $146 million in the first four months of the year, of which 7 million pairs worth $29 million were from China, data from Abicalçados showed.

China overtook the United States as Brazil's largest trading partner in 2009. However, trade frictions between the two have been rising.

On Monday, Brazil also launched an anti-dumping investigation into basic refractory materials imported from China, the MOFCOM said on its website Wednesday.

In September 2011, the Brazilian government raised the industrial products tax IPI on imported vehicles and domestic automakers that do not meet its new investment and domestic content requirements to between 37 and 55 percent, undermining the competitiveness of Chinese carmakers in Brazil.

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