The bicycle industry has been identified as a key industry in China’s current five-year plan and its Made in China 2025 initiative. Thus it is very likely that the state-backed producers would return to selling them at high volumes and at artificially low prices.
The European Union is poised to extend anti-dumping duties on Chinese bicycles for a further five years given that input costs are distorted by state intervention.
The European Commission has already completed a review of whether such measures are still warranted and has concluded that they are. Once EU governments do not oppose this finding, tariffs on Chinese bicycles will continue to be in place for the next five years.
The move is the latest in a series of measures taken by the European Union against a flood of low quality Chinese imports ranging from solar panels to steel.
At the beginning of 2019, the EU had also imposed duties of up to 79.3% on imports of Chinese electronic bicycles.
In a “disclosure document” made available to interested parties, the European Commission wrote, Chinese producers have spare capacity to make an extra 37 million bicycles which could easily flood the European market. Further, bicycles have been identified as a key industry in China’s current five-year plan and its Made in China 2025 initiative.
Given these strategic objectives, the document states, there is a “strong likelihood” that Chinese producers would return to selling bicycles at high volumes and at artificially low prices.
Thus, there is a need to place anti-dumping measures on them.