China promises to whittle down tariffs on nonwovens

09/01/2003

By Mark A. DeSorbo

GENEVA—China will pare down its tariffs on a host of nonwoven roll goods from rates as high as 23 percent to 10 percent by 2005, but the world's most populous nation says it is not prepared to make additional cuts to industrial and agriculture levies.

Still, the reduction is welcomed by the nonwoven industry as World Trade Organization members continue to work toward leveling the import-export playing field in an ever-evolving global market.

Compared to other markets, such as food and clothing, the semiconductor and electronics industries have fueled the booming global economy. And keeping stride with chip and microelectronic device manufacturing are cleanrooms and contamination control technology, says Carl Lukach, global business director for Dupont Nonwovens (Old Hickory, Tenn.).

"With so much of the cleanroom industry located or moving to China, the removal of import tariffs is a good thing," says Lukach, who also serves as vice chair of INDA, the Cary, N.C.-based Association of the Nonwoven Fabrics Industry. "This is one element of cost that we would like to see go away."

The reduction, however, is a step in the right direction.

"It's a good thing for customers in cleanrooms and makers of nonwoven goods. It's a cost that is being removed from the system," Lukach says. "The sooner we can get to a level playing field, the better—especially within the cleanroom industry because it is moving across borders so rapidly."

At press time, the United States had scrapped its plan for a tariff-free world, joining Canada and the European Union (EU) in a compromise proposal that aims at reducing import duties on industrial goods.

Progress on a variety of topics at the WTO talks—from financial services to manufactured goods—had been stymied by disagreements between the U.S. and the EU over how to open up their markets to farm goods. Ministers from all 146 nations will gather in Cancun, Mexico, this month to move the effort forward.

The Bush administration says the Chinese government has been slow in lowering trade barriers and reducing subsidies, hampering U.S. companies that have invested heavily in China, such as Motorola and Procter & Gamble Co. The Bush administration, however, continues to scrutinize China's trade practices, U.S. Commerce Secretary Donald Evans said recently.

"It's hard to say what's going to happen," says Jessica Franken, a government affairs associate for INDA.

Franken, who will attend the WTO meeting September 10-14, says member nations are expected to hammer out a modality on harmonized tariff schedules for agricultural and non-agricultural goods.

"It will be the framework for how they will go about future reductions. China will still have a tariff of 10 percent, while [the U.S.] maintains a zero tariff," she says. "At the very least, we are seeing a reduction on nonwoven roll goods, and this is definitely a good thing because they have maintained these exorbitantly high tariff rates."