The Korean paper industry Thursday denied a claim made in the United States that it is unfairly receiving state subsidies and exporting its products at a low price.

Officials said that their products are sold in the U.S. at higher prices than in Korea, after NewPage Corporation, a leading paper manufacturer in the U.S., filed a complaint last month to the Department of Commerce, which decided to launch an anti-dumping and countervailing investigation into Korean, Chinese and Indonesian ``coated wood-free paper.’’

The value-added printing paper is generally used for the production of brochures, calendars and albums.

Seven Korean paper firms are being targeted by the investigation _ Hansol, EN Paper, Kyesung, Hongwon, Hankuk, Moorim and Namhan.

Contrary to the U.S. claim, the price of Korean papers sold in the U.S. is higher than those marketed in the country, said an official with Moorim Paper, which is monitoring the affair. ``Thus, U.S. anti-dumping measures are not applicable to Korea.’’

Unlike China and Indonesia which export their papers to the U.S. at a low price, Korea has priced its papers in the U.S. at a high level over the years due to weak domestic spending.

Korean papers were also caught in the middle of heavy competition amid low-priced Chinese products coming into the U.S.

The official believes that the U.S. has included Korea along with other Asian rivals in this antidumping matter for several reasons _ Korea is one of Asia’s big exporters to the U.S., and it would seem unfair just to investigate two Asian countries.

Additionally, since NewPage is losing its competitive edge in the U.S. market against the rising forces of Asian paper manufacturers, the company is trying to dump its low market share blame on them.

Last year, Korea shipped some 378,000 tons of writing and printing paper to the U.S., recording about $315 million in sales last year.

Sales of Korean paper reached $181 million in the first six months of this year.

Korean paper makes up the largest Asian share of total U.S. paper imports, accounting for about 26 percent, followed by China with 14 percent and Indonesia with 3 percent, according to the Trade Ministry in Seoul.

The country has been seeing its paper sales in the U.S. steadily rising since 2003.

Regarding the U.S. countervailing drive, industry officials said the Korean paper industry does not either receive special treatment or special subsidies as the U.S. claims.

``Like any other industry, when we do ask for government support, its a loan,’’ said the Moorim official. ``The U.S. countervailing probe on Korean papers is a direct challenge against Korea’s state policy.’’

He said the domestic paper industry will comply with the investigation in coordination with the Trade Ministry, while continuing to express Korea’s stance on the matter to the U.S.

Under the World Trade Organization regulations, the Department of Commerce has 18 months to decide whether to levy duties on Asian companies for alleged damages caused to the U.S. firm.

Robin Sheen
Staff Reporter