"Dumping" in International Trade

A very interesting topic of international trade is the ‘dumping’ of products. When I first heard of it my mind went to products being dumped in other countries. However, after research I found out that, dumping in International trade is when one country exports a significant amount of goods to another country at prices much lower than in the domestic market. In other words, they charge more in their countries than they do to export countries. This does not seem to be a fair competition. Such issues are often referred to the WTO. 

The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments. They aim to help producers of goods and services, exporters, and importers conduct their business.  Moreover, the WTO agreement does not pass judgement. Its focus is on how governments can or cannot react to dumping — it disciplines anti-dumping actions, and it is often called the “Anti-dumping Agreement”. 

At the meeting of the Committee on Anti-Dumping Practices on 26-27 October 2010, 32 WTO members reported taking anti-dumping actions during the first half of the year (the European Union counting as one).  A number of these actions were questioned during the meeting, and the members concerned were urged to follow WTO rules. Read more here.

A recent case which, inter alia, concerns dumping of products is the one between USA and China. There are claims that US steel had been dumped onto the Chinese market and is subsidized. Read the full story here.

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 Further Reading:

http://www.france24.com/en/20100916-us-takes-two-china-trade-cases-wto

http://www.terradaily.com/reports/US_takes_two_China_trade_cases_to_WTO_999.html

http://www.wto.org/english/tratop_e/adp_e/adp_e.htm

http://www.wto.org/english/docs_e/legal_e/ursum_e.htm#fAgreement