Economy

China's unfair trade practices hurting Latin American footwear industry

China has been flooding Latin American markets with cheap shoes that have led to job losses and factory closures. These products also are often shoddy and do not comply with environmental standards.

A Chinese salesman sells counterfeit American shoes in Shanghai, as the Latin American footwear industry accuses China of dumping cheap shoes in the region and creating unfair competition. [Chandan Khanna/AFP]
A Chinese salesman sells counterfeit American shoes in Shanghai, as the Latin American footwear industry accuses China of dumping cheap shoes in the region and creating unfair competition. [Chandan Khanna/AFP]

By Giselle Alzate |

BOGOTA -- The Latin American footwear industry has accused China of "dumping" cheap footwear in the region and creating unfair competition.

Dumping is the practice of selling something abroad at extremely low prices to undercut competitors in the importing country.

In an article published at the end of July, the Revista del Calzado (Footwear Magazine) urged the Latin American footwear guild to unite in the face of the low prices of products subsidized by Beijing and its unfair competition.

Guild members of the Latin American footwear met in Cúcuta, Colombia, on June 22-23, to participate in the 25th Latin American Footwear Forum.

Luis Beron, a shoemaker specializing in making shoes for dancing tango, works in his workshop store in Buenos Aires, Argentina. The Latin American footwear industry has accused China of dumping cheap footwear in the region and creating unfair competition. [Luis Robayo/AFP]
Luis Beron, a shoemaker specializing in making shoes for dancing tango, works in his workshop store in Buenos Aires, Argentina. The Latin American footwear industry has accused China of dumping cheap footwear in the region and creating unfair competition. [Luis Robayo/AFP]

Latin America produced more than 1.5 billion pairs of shoes in 2022, representing approximately 7% of global production. This makes the region the fifth largest producer of shoes in the world, after China, India, Vietnam, and Indonesia.

However, the industry has faced difficulties due to unfair competition from China.

The director of the Brazilian Association of Footwear Industries, Haroldo Ferreira, said that the footwear guild in Latin America must unite to face unfair Chinese competition.

'Dumping' cheap shoes

China exports shoes below the cost of production because of the gigantic subsidies that Beijing grants to its producers, he said.

"Only Brazil, Argentina and Peru have anti-dumping defense mechanisms against footwear imported from China, even though it's a common problem in Latin American footwear-producing countries," Ferreira told to Revista del Calzado.

He also commented that the anti-dumping measures filed by these counties are meant to protect their footwear production from smuggling and unfair competition.

Some manufacturers in Latin America do not always have the support of their governments to deal with the arrival of cheap Chinese shoes, he said.

Mauricio Battaglia, president of the Chamber of the Footwear Industry of the State of Guanajuato (Ciceg) and the National Chamber of the Footwear Industry of Mexico (Canaical), said that the main problem facing the guild in his country is the "unfair competition" from imported shoes.

Cheap shoes from China are flooding the Mexican market, making it difficult for domestic producers to compete, he said.

In 2010, the Mexican footwear industry contributed 0.7% to the country's GDP.

However, this figure has declined to 0.4% today. Battaglia attributes this decline to "unfair competition from imported shoes, which are often sold below the cost of production."

The Argentine measure against the dumping of "footwear imported from China" has helped keep the Argentine shoe industry strong, said Horacio Moschetto, executive secretary of the Argentine Chamber of the Footwear Industry (CIC).

"We have been fighting against unfair Chinese competition since 2010, and we have been successful," he said.

Unfair competition from China is a major obstacle to the growth of Latin American economies, said Daniel Risafi, coordinator of the Association of Footwear Chambers of Latin America (Accal) and chairman of the Argentine CIC.

"The issue was widely discussed during the Latin American Footwear Forum. It is not only the local industry that is at risk when devalued shoes enter the market, but also the consumers themselves, since these are often of poor quality and [harm] the environment," he said.

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