January 21, 2005

 

 

Shrimp group says tariffs will aid tsunami-hit Asia

 

American shrimpers say recently removing tariffs will actually help drive up prices in countries hit by the Asian tsunami.

 

This was in response to a plea by the World Trade Organization to ease trade barriers on countries struck by the tsunami in Asia.

 

Last Friday, Supachai Panitchpakdi, the director-general of the World Trade Organization, urged member countries to pull down trade barriers on countries struck by the tsunami. Those countries include Thailand and India, both of which were targeted in a drive to get tariffs imposed on farm-raised shrimp dumped at unfair prices on the U.S. market.

 

The Southern Shrimp Alliance, an eight-state group of U.S. fishermen and processors, has come out and said that tariffs on shrimp from Thailand and India will actually drive up prices back in those countries.

 

"Ironically, imposition of antidumping orders could be the saving grace for shrimp-farming countries who need to receive more money for their product to restore the tsunami-ravaged communities of India and Thailand," said Eddie Gordon, president of the Southern Shrimp Alliance.

 

He argues that without duties U.S. importers would "be allowed to continue to demand low, dumped prices from these countries, depriving foreign shrimp farmers of the full, fair value of their shrimp." As a result, the dumped trade will see less money going back to the countries.

 

The group brought the antidumping case against six countries in all: Brazil, China, Ecuador, India, Thailand and Vietnam.

 

The SSA says that between 2000 and last summer imports rose by 71 percent from those countries, but that prices dropped by 39 percent, resulting in a loss of US$1.1 billion in profits for producers in those countries.

 

Earlier this month the Bush administration imposed tariffs on the six countries' frozen shrimp exports. However, officials said they would review the cases of Thailand and India and possibly lift tariffs if it is determined that their shrimp industries were too badly hurt by the tsunami.

 

Instead of lifting tariffs, the SSA is urging American importers to pay more for shrimp coming from tsunami-hit countries. This suggestion has met with both support and backlash among members of the association.

 

Importers, restaurants and supermarket chains opposed tariffs, saying they would push prices up for consumers and do little to resolve deep-set problems in the domestic shrimp fleet, which is competing with cheap and year-round shrimp farming operations overseas.

 

Duty rates for the six countries range between 2.3 percent and 112.8 percent.

 

Brazil faces duties between 9.6 percent and 67.8 percent; China between 27.8 percent and 112.8 percent; Ecuador between 2.3 percent and 4.4 percent; India between 5 percent and 13.4 percent; Thailand between 5.7 percent and 6.8 percent; and Vietnam between 4.1 percent and 25.7 percent.