US to probe Thai shrimp subsidy
- Published: 20/01/2013 at 05:13 PM
- Online news:
The US International Trade Administration has formally initiated an investigation into export subsidies on shrimp from seven countries including Thailand, after complaints of government assistance to dump the product on the US market.
The US launched an investigation into the alleged subsidies worth more than US$4 billion by seven top global producers that could lead to new import duties. The other six countries are China, Indonesia, India, Ecuador, Malaysia and Vietnam.
It is the third investigation in eight years by the United States of shrimp from Thailand, the country's largest import of seafood. Thailand was cleared or faced token fines in 2004 and 2008, and the dwindling US shrimp industry's charges have not changed.
The countervailing duty (CVD) investigation targets mainly farmed shrimp exported frozen to the US, which was valued at $4.2 billion in 2011.
The investigation was launched in response to a complaint by US shrimp harvesters and processors.
The Coalition of Gulf Shrimp Industries said in a Dec 28 petition to the government that shrimp producers in the seven countries "have gained US market share by aggressively undercutting domestic prices through the use of billions of dollars in assistance from their respective governments".
"Subsidised imports have suppressed and depressed domestic prices, eroding domestic sales, destroying US jobs, and eliminating the operating margins of domestic producers."
The International Trade Administration said Thailand was the leading exporter of the seven, shipping $1.6 billion worth of shrimp to the US in 2011.
Indonesia shipped $667 million worth, Vietnam $493 million, India $512 million, Ecuador $524 million, China $154 million, and Malaysia $206 million.
The US government plans to make its initial decision on whether to continue the investigation in February. Final determinations could come in July, the agency said.
Pranee Siriphand, director-general of Foreign Trade Department, said the export of shrimp from Thailand may face a hiccup during the investigation that will take 45-85 days to determine the damages and another 85 days to determine the existence of the subsidies.
The department was determined to work with the Thai private sector to fight the case, she said. In the past, it had successfully brought down the rate of anti-dumping duty charged on Thai shrimp to a level allowing Thai exporters to compete with other countries, she added.
After the launch of the investigation, Vietnam has made an official approach to the US.
According to Vietnam News Agency, the Vietnam Association of Seafood Exporters and Producers and the Vietnam Trade Office in the US expressed dissatisfaction and made a protest during a consultation on Jan 19 with the Import Administration under the US Department of Commerce's International Trade Administration.
The association said that if the CVD tax is collected on Vietnam's frozen warm-water shrimp, it will adversely affect the livelihoods of more than 600,000 Vietnamese shrimp farmers and processors.
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