EU Struggling with the trade issue with China…..
By Stephen Castle
International Herald Tribune
November 6, 2007
Of the many disputes that have strained ties between Europe and China, perhaps the most revealing arose over trade in light bulbs.
The tension over EU imports of cheap, energy-saving bulbs reached its peak this fall when the European Commission, fearing job losses in Europe, postponed plans to remove tariffs on Chinese-made products.
The debate that preceded this action illustrated just how much globalization has transformed international trade and the question that confronts Europeans and others: Does China represent a threat or an opportunity? As much as it pitted European interests against Chinese ones, the dispute also saw two European companies – and two sets of European concerns – clashing with each other.
The company lobbying hardest for an end to duties of as much as 66 percent on Chinese imports was Philips Electronics of the Netherlands, which manufactures many of its light bulbs in China and stands to gain €15 million to €20 million, or $20 million to $29 million, a year if trade barriers are removed. Its rival Osram, a German company that manufactures far fewer light bulbs in China, would benefit far more if duties stayed in place.
As the lobbying and bickering intensified, Osram even challenged Philips’s right to be considered a European producer of light bulbs because it outsourced so much of its production.