WORLD TRADE  
ORGANIZATION  G/SG/N/8/EGY/5 
G/SG/N/10/EGY/5 
G/SG/N/11/EGY/1 
22 August 2008 
 (08-3960) 
Committee on Safeguards Original:   English 
  
 
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE 
AGREEMENT ON SAFEGUARDS ON FINDING A SERIOUS INJURY 
OR THREAT THEREOF CAUSED BY INCREASED IMPORTS 
 
NOTIFICATION PURSUANT TO ARTICLE 12.1(C) 
OF THE AGREEMENT ON SAFEGUARDS 
 
NOTIFICATION PURSUANT TO ARTICLE 9,  
FOOTNOTE 2, OF THE AGREEMENT ON SAFEGUARDS 
 
 
EGYPT 
 
(Blankets)
 
  The following communication, dated 20 August 2008,  is being circulated at the request of the 
Delegation of Egypt.   
 
______________ 
 
 
The Arab Republic of Egypt hereby wishes to  notify the Committee on Safeguards pursuant 
to Article 12.1(b) of the Agreement on Safeguard s on finding serious injury caused by increased 
imports, Article 12.1(c) of the Agreement of Safegua rd on the decision to apply a definitive safeguard 
measure and footnote 2 of Article 9 of the Agreement on Safeguards.   
 
Consistent with Article 12.3 of the Agreement on Safeguards, Egypt is prepared to consult 
with those Members having a substantial inte rest as exporters of the subject product.   
 G/SG/N/8/EGY/5 
G/SG/N/10/EGY/5 G/SG/N/11/EGY/1 
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  A. N
OTIFICATIONS UNDER ARTICLE 12.1(B)  AND 12.1(C)  OF THE AGREEMENT ON SAFEGUARDS 
UPON MAKING A FINDING OF SERIOUS INJURY  
1. Evidence of Serious Injury Caused by Increased Imports 
(a) Serious Injury 
 In order to make a final dete rmination of serious injury to the domestic industry producing the 
like or directly competitive product, an evalua tion of all relevant factors on an objective and 
quantifiable basis having a bearing on its situation has been undertaken.    (i) Market Share 
 2004 2005 2006 2007 
Market share of 
Domestic Industry  85% 64% 10% 11% 
Market share of 
Imports 15% 36% 90% 89% 
 
The market share of the domestic industry declin ed by 21 per cent in 2005, when compared to 
2004;  by 53 per cent in 2006, when compared to 20 05;  and, increased by 1 per cent in 2007, when 
compared to 2006.  It however remained significantly below the levels of 2004 and 2005.  At the same time, the market share of imports increased by 21 per cent in 2005, when compared to 2004;  
by 53 per cent in 2006, when compared to 2005;  and, then declined by 1 per cent in 2007, when 
compared to 2006.   
 
(ii) Domestic Sales 
1,000 blankets  2004 2005 2006 2007  
Sales Volume 717 752 661 631 
 
The domestic industry's sales increased by 5 pe r cent in 2005, when compared to 2004 and 
then declined by 12 per cent in 2006, when comp ared to 2005.  This decline continued in 2007 
by 5 per cent, when compared to 2006.    
(iii) Production 
1,000 blankets  2004 2005 2006 2007  
Production Volume  821 801 791 726 
 
The domestic industry's production declined by 2 per cent in 2005, when compared to 2004, 
and then by 1 per cent in 2006, when compared to 2005.  The decline in production continued in 2007 by 8 per cent, when compared to 2006.    G/SG/N/8/EGY/5 
 G/SG/N/10/EGY/5 
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  (iv) Productivity 
Blankets/worker 2004 2005 2006 2007 
Productivity 1,087 1,024 1,150 1,098 
 
 Productivity declined by 6 percent in 2005, when compared to 2004, by 12 per cent in 2006, when compared to 2005;  and, by 5 per cent in 2007, when compared to 2006.   
 
(v) Capacity Utilisation 
 2004 2005 2006 2007 
Capacity utilization   57 51 50 46 
 
 Capacity utilisation declined by 6 per cent in 2005, when compared to 2004;  by 1 per cent 
in 2006, when compared to 2005, and by 4 per cent in 2007, when compared to 2006.   
 
(vi) Profit and Loss 
1,000 EGP  2004 2005 2006 2007 
Losses 9,268 7,915 15,922 13,200 
 
 Losses decreased in 2005, when compared to year 2004, but then increased by 101 per cent 
in 2006, when compared to 2005.  In 2007 losses dec lined by 17 per cent when compared to 2006.   
 
(vii) Employment 
 2004 2005 2006 2007 
Numbers of employees   755 782 688 661 
 
 The number of employees increased by 4 per cent in 2005, when compared to 2004;  then declined by 12 per cent in 2006 when compared to  2005; and, by 4 per cent in 2007, when compared 
to 2006.    
(viii) Inventory 
1,000 blankets 2004 2005 2006 2007 
Inventories 230 235 345 344 
 
 Inventory volumes increased by 2 per cent in 2005, when compared to 2004 and by 47 per cent in 2006 when compared to 2005.  Inventory volumes remained stable in 2007, when compared 
to 2006.   
 
(ix) Conclusion 
 When the volume of imports increased sharpl y, the sales and market share of the domestic 
industry declined significantly; its average selling pri ce deteriorated in absolute terms and its cost of 
production increased as a percentage of the selling pr ice; production and capacity utilisation declined;  
labour numbers and productivity declined;  the volum e of inventory increased;  and, there was a sharp 
increase in the domestic industry's losses.  Consideri ng all relevant factors, a final determination was 
made that the domestic industry is suffering serious injury.   G/SG/N/8/EGY/5 
G/SG/N/10/EGY/5 G/SG/N/11/EGY/1 
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  (b) Causation 
(i) Increase in Imports 
 The volume of imports sharply increased in ab solute terms and relative to the production of 
the subject product in 2006.  Despite a slight decline in 2007, the volume of imports in that year 
remained significant.     The sudden and sharp increase in the volume of im ports in 2006 led to the deterioration in the 
domestic industry's economic indices.  This led to a decline in its ability to sell in the domestic 
market;  in its production;  in its ability to utilise the available capacity;  and, to an increase in its 
volume of inventory.  The decline in the production and in the ability to utilise the available capacity 
led to labour layoffs.  The decline in the volume of sales of the domestic industry was accompanied by a significant decline in the average selling price and an increase in the cost as a percentage of the 
selling price, which led to sharp losses to the i ndustry in 2006 and 2007.  In 2007, with the slight 
decline in the volume of imports, some of the economic indices of the domestic industry partially 
improved, when compared to 2006, but they remained below the levels of 2004, 2005.    
(ii) Other Causes 
 The potential that the export performance of the domestic industry may be one of the other 
causes of the serious injury suffered by the domestic industry was considered.   
 
Domestic Industry's Export's Sales  
 
1,000 blankets 2004 2005 2006 2007 
Export Volumes 70 26 40 97 
 
 It is noted that there was a 63 per cent decline in the domestic industry's export volumes 
in 2005 (before the significant increase in the imports occurred) when compared to 2004.  At the same 
time, the industry's domestic market  sales increased by 5 per cent.  In 2006 and 2007, a substantial 
increase in the imports of the product concerne d took place and a sharp decline in the domestic 
market's sales occurred when compared to 2005.  As a result, the domestic industry increased its 
exports by 54 per cent and 143 per cent respectively, when compared to 2005.  This indicates that the 
export performance of the domestic industry did not have a negative effect on the economic indices of 
the domestic industry.   
 
2. Absolute or Relative Increase in Imports 
 An analysis of the increase in the volume of im ports into the Egyptian market of the subject 
product has been carried out over the period 2004 to 2007, both in absolute terms, and relative to 
domestic production.  The analysis has shown that imports of the product concerned increased sharply 
in that period.   
 
 2004 2005 2006 2007 
Imports  
(1,000 blankets) 128 421 6,087 5,314 
Imports as % of 
Domestic Production  16 % 53% 770 % 733 % 
  G/SG/N/8/EGY/5 
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   Import statistics reveal an increase in imports by 229 per cent in 2005, when compared 
to 2004;  by 1346 per cent in 2006, when compared to 2005;  and, a decline in imports by 13 per cent in 2007, when compared to 2006.   
 
 Data obtained from the domestic industry further indicates that the volume imports expressed as a percentage of domestic production increased by 37 per cent in 2005, when compared to 2004;  
by 717 per cent in 2006, when compared to 2005;  and, declined by 37 per cent in 2007, when compared to 2006.  In 2007, the volume of imports  still equalled 733 per cent of the total domestic 
industry production.   
 
3. Description of the Subject Product 
 Blankets manufactured of artificial fibres of all sizes and weights.  The product is commonly 
classified under HS tariff item numbers:  630190 and 630140.   
 
4. Description of the proposed measure 
 It is proposed to impose a definitive safeguard measure is in the form of a specific duty of 
22 EGP/kg for the first year, 20 EGP/kg for the second year and 18 EGP/kg for the third year.    
5. Proposed Date of Introduction of the Measure 
 Application of the measure is pending approval of the Minister of Trade and Industry.   
 
6. Expected Duration of the Measure 
 The expected duration of the proposed measure is three years.   
 7. Date of Review 
 Not available.   
 
8. Timetable for the Progressive Liberalisation of the Measure 
 To facilitate adjustment, the proposed m easure will be liberalised as follows:   
 
(EGP/kg) 
Period From 12/2/2008 till 
11/2/2009 From 12/2/2009 to 
11/2/2010 From 12/2/2010 to 
11/2/2011 
Duty 22 20 18 
 G/SG/N/8/EGY/5 
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  B. N
OTIFICATIONS PURSUANT TO ARTICLE 9, FOOTNOTE 2 OF THE AGREEMENT ON SAFEGUARDS  
1. Description of the proposed measure 
 It is proposed to impose a definitive safeguard measure is in the form of a specific duty of 
22 EGP/kg for the first year, 20 EGP/kg for the second year and 18 EGP/kg for the third year.   
 
2. Description of the Subject Product 
 Blankets manufactured of artificial fibres of all sizes and weights.  The product is commonly 
classified under HS tariff item numbers:  630190 and 630140.   
 
3. Developing Countries Exempted from the Safeguard Measure 
Imports from developing country Members shall not be subject to the definitive safeguard 
measure as long as each Member's imports do not exceed  three per cent of total imports into Egypt 
and the share of the Members with less than a th ree per cent import share do not collectively account 
for more than nine per cent of total imports into Egypt.   
 
 
__________