What is anti-dumping

Anti-dumping in finance refers to the practice of imposing additional tariffs or duties on imported goods that are being sold at a price lower than their fair market value, in order to protect domestic industries from unfair competition. Dumping occurs when a company exports a product at a price lower than the price it would normally charge in its own domestic market or lower than the cost of production. This can be seen as a form of predatory pricing, aimed at driving competitors out of the market. Anti-dumping measures are intended to level the playing field for domestic producers and prevent them from being undercut by unfairly priced imports. These measures may be imposed by a country's government in response to a complaint from a domestic industry that is being harmed by dumping. The government will then conduct an investigation to determine whether dumping is occurring and whether it is causing injury to the domestic industry. If the investigation finds evidence of dumping and resulting harm to the domestic industry, the government may impose anti-dumping duties on the imported goods. These duties are intended to offset the unfair advantage that the dumped goods have in the market and bring their price closer to their fair market value. The duties are typically calculated based on the difference between the export price and the fair market value of the goods. Anti-dumping measures are controversial and can lead to trade disputes between countries. Critics argue that they can be used as a form of protectionism and may ultimately harm consumers by reducing competition and raising prices. However, proponents argue that they are necessary to prevent unfair trade practices and protect domestic industries from being driven out of business by unfairly priced imports. Overall, anti-dumping is a complex and contentious issue in international trade and finance.