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Sat, Mar 30, 2002 - Page 18 News List

Formosa Plastics denies dumping charges

TOO CHEAP?China began an investigation into PVC producers from Taiwan, the US and other countries after receiving complaints from a number of its own producers

STAFF WRITER, WITH BLOOMBERG , BEIJING

Formosa Plastics Corp (台塑) has denied dumping polyvinyl chloride (PVC) in the China market, after an announcement by Beijing that it was launching an investigation into PVC producers from Taiwan, the US, Russia, Japan and South Korea.

This is the second time in one week that China has singled out Taiwan for investigations into dumping -- previously Beijing accused Taiwan's steelmakers of selling below-cost cold-rolled steel in its market.

In response to the charges, Taiwan again urged China to observe the rules of the World Trade Organization -- to resolve the disputes despite Beijing's refusal to internationalize the cross-strait relationship.

China's Ministry of Foreign Trade and Economic Cooperation began an investigation into the above-listed countries after receiving complaints from a number of domestic producers, according to a spokesman.

Formosa Plastics is the world's second largest producer of PVC -- used in the production of bottles, plastic pipes, toys and televisions -- and is a major exporter of PVC into China.

Formosa executives said they had not yet received any notification of China's investigation but they said the company will cooperate by providing all the relevant information.

The executives denied that Formosa had sold PVC in China at below the international prices and said they have objective evidence to prove it.

Other major Taiwanese PVC producers who are likely to face investigation, are China General Plastics Corp (華夏) and Ocean Plastics Co (大洋塑膠).

John Teng (鄧振中), vice chairman of the Mainland Affairs Council, said that China should respect its obligations as a member of the WTO in handling the matter.

"We will try to help protect Taiwanese PVC makers' interests under the rules of the WTO," he said.

Both Lin Yi-fu (林義夫), minister of economic affairs and Yen Ching-chang (顏慶章), Taiwan's ambassador to the WTO, have earlier this week urged China to use the trade body to help resolve the issue.

But Li Weiyi (李維一), spokesman for Beijing's Taiwan Affairs Office, said on Wednesday that the investigation into Taiwanese steelmakers is "an internal affair of China's."

Meanwhile, Vice Economic Affairs Minister Steve Chen (陳瑞隆) said that, so far, none of the mentioned Taiwanese companies have received notification from Beijing about the anti-dumping probe.

Chen noted that the launch of an anti-dumping investigation does not necessarily lead to a charge of dumping, nor does it mean that China will impose anti-dumping punishments.

He added that the ministry will foot the attorney and accounting bills to help the Taiwanese companies fight for their rights and interests.

The five companies who requested the investigation are Beijing Huaer Co (北京化二), Jinhua Group Co (錦化化工), Shanghai Chlor-Alkali Chemical Co (上海氯鹼化工), Tianjin Dago Chemical Co (天津大沽化工), and Heibei Cangzhou Chemical Co (河北滄州化工).

In the last few years China's market for PVC has grown considerably, with imports of the product increasing last year by 32 percent year-on-year to 1.91 million metric tonnes.

Around 30 percent of Taiwan's annual production of 1.4 million metric tonnes of PVC is exported to China.

The Taipei government only last week announced that Formosa could invest as much as NT$250 billion to set up plastics companies in China.

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