Distinguish between the following: (iii) 'Anti-dumping duties' and 'countervailing duties'.

'Anti-dumping duties' and 'Countervailing duties' Antidumping and Countervailing duties essentially seek to remedy the same problem i.e. artificially low priced imports. However, the root cause of the artificially low price is what differentiates antidumping and countervailing duties. Anti-dumping duties are for combating "dumping", which means that an exporter is setting prices at such a low point, that they are intentionally losing money in order to harm the domestic producers of the importing country. It is a 'predatory pricing model' where the exporter prices its goods below production costs or below what they sell for in their home market. Countervailing duties seek to counteract artificially low prices that are a result of 'subsidies'. Governments often offer all sorts of subsidies on exports in the form of tax breaks and credits. Because of these subsidies, exporters are able to offer lower prices than domestic producers in the importing country. Countervailing duties level the playing field and negate the advantage that exporters get from subsidies. Despite of this, antidumping and countervailing duties go hand in hand.