Prospect of EU shoe duties grows as Austria steps in

- The prospect of the European Union imposing anti-dumping tariffs on leather shoes from China and Vietnam grew on Wednesday when Austria, previously against the plan, proposed a compromise, trade diplomats said.
A narrow majority of EU countries remain opposed to the duties. But Austria's suggestion that they be introduced for a year and then be reviewed is a blow to free-trade countries within the bloc opposed to the tariffs, the diplomats said.
"I think that with this new idea there might be some wobbling by other member states," said a trade envoy.
Trade specialists from EU countries met in Brussels to discuss the proposal put to them by the executive European Commission but did not vote on it, diplomats said.
The issue has again underscored a north-south rift in the EU on how to meet the challenges of a globalised economy. Italy has led a push by shoe-producing EU countries for the duties. But Nordic countries, which traditionally favour free trade, co-ordinated a rival group to block the measures.
Last month, 14 of the EU's 25 member countries - including Austria - objected to the proposed duties of 16.5 percent for leather shoes from China and 10 percent for Vietnam.
But EU Trade Commissioner Peter Mandelson pressed on with the proposal, leaving it for EU countries to argue over. "Member states are discussing some ideas. If they can reach agreement on a position that commands majority support, Mr Mandelson will consider it," spokesman Peter Power said on Wednesday. "Meanwhile the Commission proposal stands."
The Commission has said it has evidence of tax breaks and other state intervention by China and Vietnam which unfairly helped their shoe exporters. The two countries deny the charge.
Brussels imposed provisional anti-dumping duties in April which lapse on October 6 unless a majority of EU states back their replacement by definitive duties that normally last five years. The shoes row is seen as a prelude to a debate soon on a possible overhaul of the anti-dumping rules by Mandelson's team to reflect growing investments by European manufacturers in Asia, and the interests of consumers who want cheap goods.
Leading shoe companies which increasingly use Asia for making the shoes they sell in Europe and elsewhere have fought against the shoe duties plan. This week several footwear groups and retail associations sent a letter to EU heads of government. "We call on your government to stand firm and resist protectionist voices using the lack of competitiveness of producers in a handful of European countries to punish the vast majority of Europe's footwear industry and consumers," it said. In the opposite camp, Italian Prime Minister Romano Prodi has personally urged other EU leaders to back the measures.