Britain’s steel industry is facing extinction and now the European Union is indirectly blaming the UK for the destruction of its own sector.
According to a report in the Financial Times, citing unnamed senior EU officials, Britain blocked the 28-nation bloc’s attempts to overhaul anti-dumping rules related to the glut of cheap Chinese steel imports.
In the same report, Axel Eggert, head of the European Steel Association, which represents every steelmaker on the continent, supported these claims.
“The UK is the ringleader in a blocking minority of member states that is preventing a European Commission proposal on the modernisation of Europe’s trade defence instruments,” said Eggert to the FT.
The claims that Britain blocked the anti-dumping rules overhaul can be seen as the EU blaming Britain for the mess its steel industry is currently in.
In other words, the officials are saying the EU tried to curb the amount of cheap Chinese steel flooding the market — which is pushing down prices across the market and therefore making it impossible for UK companies to compete — but Britain stopped it.
Critics of the Conservative government claim Prime Minister David Cameron is keen on keeping China sweet due to the number of huge economic deals the UK has with it.
Earlier this week it was confirmed Tata Steel is putting up its entire UK business up for sale and now around 14,000 jobs are at risk.
Tata said its decision was based on “structural factors including global oversupply of steel, significant increase in third country exports into Europe, high manufacturing costs, continued weakness in domestic market demand in steel, and a volatile currency,” in a statement on Tuesday.
According to another report in the FT, it’s estimated to cost Tata Steel as much as $200 in labour to produce one tonne of steel in the UK, while in China the figure is closer to $10.
China produces half the world’s steel and has ramped up production massively over the last 30 years.
China used to only mainly export its steel to other Asian countries but as its economy began slowing down, it started to place — or “dump,” as anti-China critics say — lots of its cheap steel on overseas markets, which pushes down prices. China’s crude steel production over the last decade has exploded, bringing hundreds of millions of tonnes more per year to the market.
But while the EU is blaming China for the slump in steel prices and the current plight of Britain’s steel industry, Business Insider pointed out on Thursday the EU is actually also to blame for the demise of the sector.
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