EU 'horse-trading' links Belarus and Chinese shoes

By Andrew Rettman

EUOBSERVER / BRUSSELS - Chinese shoes are threatening to block EU plans to impose trade sanctions on Belarus, with EU officials saying Italy is using Belarus in an unrelated antidumping dispute in a classic piece of EU political horse-trading.

Rome on 26 September surprised Brussels by abstaining from a vote on the Belarus sanctions, thus clearing the way for Poland, Lithuania and Latvia to block proposals to expel Minsk from the Generalised System of Preferences (GSP) on trade.

But while the trio opposed the move on fears it could hurt small traders, EU officials say Italy did it to get back at the UK, Germany and Sweden for blocking proposed EU tarriffs on cheap Chinese shoe imports, which are driving Italian shoemakers out of business.

"There was a gentlemen's agreement that member states would protect each others' manufacturers," an EU diplomat stated. "The northern countries, which import shoes, broke it and now the EU shoemaking countries are attacking their policies in other areas."

The Belarus GSP question will come up for a fresh vote on 12 October, but not before EU ambassadors meet in Brussels on 3 and 4 October to hammer out an agreement on the Chinese so-called "antidumping" tariffs.

A European Commission official said "the political fallout would be just huge" if Italy sticks to its Belarus line on the 12 October vote, with the GSP expulsion based on an 18 month investigation into Belarus' violation of international trade union codes.

"[Italy's] position is completely untenable," the commission contact stated. "I mean, the EU has to recognise that this regime [Belarus] is carrying out flagrant abuses."

For its part, Italy hotly denies any connection between the China and Belarus dossiers, saying its Belarus abstention is designed to give Minsk a final chance to fall into line in a "carrot and stick approach."

"Can you imagine Mr Romano Prodi's centre-left government doing something to go against the international trade union movement?" an Italian contact stated.

Brussels' open secret

The fact that member states trade approval on one policy for gains in another, unrelated policy is an open secret on the EU political scene, however.

In late 2005, Brussels was abuzz with talk that France made its approval for giving EU candidate status to Macedonia and for opening accession talks with Turkey conditional on the UK backing down on plans to overhaul the EU budget.

In 1992, the UK agreed to let France enshrine the Strasbourg seat of the European Parliament in the EU treaty in return for Paris' agreement for London to opt out from EU social legislation.

"If you give me this, then I'll give you that - that's how Europe works," the EU diplomat stated, warning that Italy's position on Belarus could be just the beginning of a clandestine shoe war.