Levelling the Playing Field – Reform of Australia’s Anti-Dumping Regime

On its website, the Department of Innovation, Science and Industry has stated that: -

“The Government has implemented reforms to Australia’s anti-dumping system aimed at ensuring Australian manufacturers and producers are able to compete on a level playing field with imported goods.”

This raises a number of questions.

What is a “level playing field” in commerce? Is there such a thing? If a company has a competitive advantage through lower raw material costs, energy costs, labour costs, better technology, etc., what is a “level trading field”? If government regulation of and policies for industries differs between countries, states, territories, cities, etc., what is a level “trading field”? In other word how is a "level trading field" to be measured?

In sports the level playing field is measured by the rules of the game, but this does not prevent teams from engaging players who are better than their competitors, coaches who are better than their competitors, different competitive strategies or technologies to improve the fitness and expertise of players. Is there a “level playing field”? I think not, which is why some teams are better than others despite a uniform set of rules for the game.

It seems to me that the concept of a “level playing field”, whether applied internationally or domestically or both is simply a fiction. There is no such thing as a level playing field. If there was in commerce, or in sport, there would be no competition. Those that advocate a level playing field are simply perpetuating a myth that there is some notion of a "level playing field".

According to the statement above from the Department of Innovation, Science and Industry, reforms are being implemented to enable Australian industries to compete with imports. Another way of looking at this is such reforms, which have as their ultimate objective of imposing customs tariffs in the form of antidumping duties, is to preclude or restrict imports from competing with Australian industries.

The effect of customs tariffs, whatever they are called, is to “protect” local industries from import competition. What effect does this have for Australian industries and the Australian economy? It makes Australian industries the beneficiaries of such tariffs less or uncompetitive in the global market and increases costs to end-users and consumers of their products in the domestic to the detriment of the Australian industry.

The purpose of successive governments to reduce customs tariffs was to make Australian industries more completive globally. The anti-dumping regime seems to be heading in the opposite direction? Why? Politics? Economics? Neither?
Does anyone know what is actually the effect of anti-dumping measures? No. Why not? Because there have been no studies on the effect of the implementation of anti-dumping measures.

Why is the Australian Government entering into free trade agreements to reduce most tariffs to zero for goods from the other country and then impose antidumping protective tariffs on those goods (e.g. steel, aluminum, etc.) it has just granted zero tariffs?

So how does one “improve” a legislative regime, such as the anti-dumping regime, without under taking a “cost/benefit” analysis or understanding what the deficiencies and benefits are? What needs to be improved and why and what will be the consequences and how does one know without such an analysis?

Comments are closed.