Higher import taxes on Chinese tyres in South Africa for the next 5 years

South Africa is imposing new anti-dumping tariffs on passenger, truck, and bus tyres originating in or imported from China, which will remain in place for a period of five years until July 2028.

Chinese tyres will now be subjected to duties ranging from 7.18% to 43.6%, as opposed to the flat rate of 38.33% provisional duties that were in place between 9 September 2022 and 8 March 2023.

The new taxes will not apply to fairly traded imports originating from other countries that enter the Southern African Customs Union, said the South African Tyre Manufacturer’s Conference (SATMC).

Fair trade

The determination to impose anti-dumping duties on Chinese tyres was made by the International Trade Administration Commission (ITAC), and the South African Minister of Trade, Industry, and Competition, Ebrahim Patel.

The move has been welcomed by the SATMC, which represents the country’s four biggest tyre manufacturers – Bridgestone, Continental, Goodyear, and Sumitomo Rubber.

“As the SATMC, we applaud this decisive measure by ITAC and the Minister, which comes as a significant victory for the domestic tyre industry,” said Nduduzo Chala, the Managing Executive of the SATMC.

“The implementation of these final Anti-Dumping duties will serve to uphold fair trade practices and protect the economy against opportunistic pricing in the tyre sector, which has posed a threat to the future of the South African tyre industry.”

The SATMC was one of the leading voices advocating for the imposition of anti-dumping duties, arguing that the dumping of Chinese-made tyres was having an adverse effect on the local industry. It claimed these wheels were unfairly priced and were therefore threatening domestic investment and job creation.

The SATMC noted that other Asian markets, such as Japan and South Korea, did not pose a threat and would therefore be unaffected by the ruling.

In response, the Tyre Importers Association of South Africa (TIASA) argued that introducing new tariffs would lead to massive price hikes for tyres that local consumers would be forced to bear.

Tyre problems

In addition to the flood of tyres dumped from other countries, South Africa’s rubber producers have sounded the alarm on an epidemic of non-roadworthy tyres that are currently in use on the country’s roads.

It estimates that there are roughly 1.5 to 2 million used tyres in South Africa and that 63% of these are not roadworthy, translating to approximately 750,000 to 900,000 illegal tyres.

This has an immediate safety concern, as worn tyres pose a serious threat to all road users because they affect a vehicle’s road-holding ability.

It also raised environmental concerns regarding the burning and dumping of excess rubber in illegal landfills.

“It’s unclear if a plan is in place to address this critical environmental challenge,” said Shaun Radbone, the owner of Dunlop franchise Orion Auto & Tyres.

“There is a significant lack of transparency from the relevant authorities on whether these products are being transformed into new products or used as a source of energy.”

The lack of information from the relevant authorities hampers efforts to establish sustainable practices in the industry, he said.