Dumping protection hurts economy: Productivity Commission

The Productivity Commission has released a report today arguing that anti-dumping measures consider only a narrow set of industries, remove the need for innovation, and don’t consider the overall cost to the economy.

AAP reports that the paper by the commission, an influential advisor the federal government, has blasted the anti-dumping system, which imposes tariffs on things like dumped tinned tomatoes following complaints made by SPC Ardmona.

Dumping is the practice of exporting and selling goods below cost, and is described as a type of predatory pricing.

"Once the emotive terminology is stripped away, any general distinction between anti-dumping protection and conventional tariff protection is a fine one," The Australian Financial Review quotes the report as saying.

"Like tariffs, anti-dumping measures benefit recipient industries, but impose larger costs on other industries, consumers and the broader economy [and] reduce the need for recipient industries to innovate in order to remain competitive and to adjust to changing market conditions more generally.”

The report’s release follows research on Asian steel dumping commissioned by the federal government – announced the day after Arrium revealed it was considering shutting its Whyalla steelworks – announced last week. The commission will report in April.

The steel industry is under heavy competition from imported Asian steel as China’s economy and its infrastructure building slows.

86 per cent of investigations into dumping in 2014-15 were to do with steel imports.