In 2,000 years of turbulent history, the indomitable Vietnamese have
prevailed over many a foreign enemy. But Vietnam has never before had to
fight the Catfish Farmers of America. And armed with the U.S.
antidumping laws — the economic equivalent of napalm — the guys from
the Mississippi Delta are really tough.
The U.S. International Trade Commission has issued a preliminary
determination that American catfish processors are “threatened with
material injury” because of Vietnamese imports. In December, the Com-merce
Department — which rarely finds accused foreigners innocent of
“dumping,” will likely fry the Vietnamese catfish industry with
prohibitive tariffs as high as 190 percent.
The heart of the complaint is that Vietnam has captured as much as 20
percent of the $500 million-plus U.S. frozen catfish fillet market by
“unfairly” peddling their fish at below cost (by law, Vietnamese
catfish are called basa, or tra, thanks to a lobbying campaign by U.S.
catfish farmers).
The Americans complain that imports are up from about 4 million
pounds in 1999 to more than 24 million pounds last year. Prices between
1999 and 2001 went south, with the average unit value per pound plunging
from $2.16 to $1.38. This would not be happening if the Vietnamese were
playing fairly, the Americans allege.
“Unless something is done to address the situation, the whole
catfish industry may collapse,” Charlie Pilkinton of the Pilkinton
Brothers Catfish farm in Columbus, Miss., testified. That would be
lamentable, to be sure.
But hold on. What’s the evidence that the Commerce Department will
be looking at to find the Vietnamese guilty of “unfairly” dumping?
Does it really make sense that fish farmers from the Mekong Delta like
Americans so much that they would give us their catfish at 190 percent
below their costs?
In search of a 190 percent antidumping margin, lawyers for the
domestic catfish industry are urging Commerce to refuse to look at the
actual costs of production in Vietnam. The rationale for this is that
Vietnam is a “non-market” economy.
Freed of the burden of examining Vietnam’s true production costs,
Commerce is being urged to pick India as a “surrogate” country of
comparable economic development.
Once Vietnam becomes India, the bureaucrats would calculate the costs
of water used in Vietnam’s fish industry by consulting data on India
in the Second Water Utilities Data Book, a publication of the Asian
Development Bank. To calculate electricity costs in the Mekong Delta,
Commerce would look at references to India in “Energy, Prices and
Taxes,” published by the Organiza-tion for Economic Co-operation and
Development in Paris.
India doesn’t even export catfish. But, hey, it has seafood. So,
catfish (or basa) become shrimp. To calculate Vietnamese overhead and
profit ratios for catfish, Commerce will check out the audited financial
statements of three Indian shrimp producers.
This is, of course, absolutely nutty. But the U.S. antidumping laws
allow Commerce officials to jigger the numbers to find accused foreigners guilty of “unfair” pricing.
To the outraged Vietnamese (and anyone with a sense of fairness), the
American antidumping laws are what’s unfair.
Greg Rushford is editor and publisher of the Rushford Report, a
Washington monthly newsletter on trade politics at www.RushfordReport.com.
