US urged to scrap ‘non-mar­ket’ sta­tus

China Daily (USA) - - BUSINESS - By ZHONG NAN zhong­nan@chi­nadaily.com.cn

Min­istry calls on Wash­ing­ton to adopt level play­ing field in trade with China

The Min­istry of Com­merce on Thurs­day urged the United States to scrap its “non-mar­ket econ­omy sta­tus” treat­ment of trade with China, and treat the coun­try’s goods ship­ment fairly, as such a mea­sure is out­dated and does not ex­ist in World Trade Or­ga­ni­za­tion rules, the Min­istry of Com­merce said on Thurs­day.

The min­istry’s com­ments came af­ter the US Com­merce Depart­ment an­nounced last week that it would post­pone is­su­ing its pre­lim­i­nary de­ter­mi­na­tion in an anti-dump­ing duty probe into im­ports of alu­minum foil from China, as it needs more time to an­a­lyze “China’s non-mar­ket econ­omy sta­tus”.

Com­merce Min­istry Spokesman Gao Feng said the so called “non-mar­ket econ­omy sta­tus” was used in do­mes­tic law by cer­tain coun­tries dur­ing the Cold War pe­riod, and to­day only a few economies of the 164 WTO mem­bers still prac­tice this.

Un­der this sta­tus, trad­ing part­ners can use a sur­ro­gate coun­try whose eco­nomic si­tudump­ing ation is sim­i­lar to China’s as a ref­er­ence when de­ter­min­ing whether they think China is dump­ing in their coun­tries.

“It is clearly not in­cluded in the WTO’s mul­ti­lat­eral trad­ing rules,” Gao said at a reg­u­lar me­dia briefing in Bei­jing.

Ac­cord­ing to Ar­ti­cle 15 of the WTO’s rules, mem­ber economies should have ceased from us­ing the sur­ro­gate coun­try ap­proach in anti- in­ves­ti­ga­tions on China on Dec 11, 2016, the 15th an­niver­sary of the na­tion’s ac­ces­sion to the global trade body.

A to­tal of 30 US states saw their ex­ports to China dou­ble over the past decade, while four states wit­nessed five­fold growth in the ship­ping of goods such as agri­cul­tural prod­ucts, au­to­mo­biles and pas­sen­ger air­craft to China, ac­cord­ing to data pub­lished on Wed­nes­day by the Min­istry of Com­merce.

Be­sides, 29 US states gained more than $1 bil­lion trade vol­ume by do­ing busi­ness with China in 2016, com­pared with 17 states in 2006.

Apart from si­mul­ta­ne­ously launch­ing anti-dump­ing and anti-sub­sidy in­ves­ti­ga­tions against Chi­nese man­u­fac­tur­ers on a reg­u­lar ba­sis since 2006, the US govern­ment has more than once used “mar­ket econ­omy sta­tus” as a bar­gain­ing chip in ex­change for China’s con­ces­sions in trade ne­go­ti­a­tions.

Gao also re­marked that the Euro­pean Union’s newly reached con­sen­sus against China’s im­ports lacks the le­gal ba­sis of WTO rules and will have a neg­a­tive im­pact on the WTO’s anti-dump­ing le­gal sys­tem as it doesn’t have dump­ing-re­lated ar­ti­cles on la­bor and the en­vi­ron­ment.

The Euro­pean Union last week adopted a sim­i­lar ap­proach, known as “sig­nif­i­cant mar­ket dis­tor­tion”, as an excuse for anti-dump­ing and anti-sub­sidy mea­sures, blur­ring the dis­par­i­ties between mar­ket and non-mar­ket economies.

“Un­der nor­mal cir­cum­stances, dump­ing in­di­cates the sell­ing of prod­ucts be­low do­mes­tic prices, but the EU will make ex­cep­tions in cases of ‘sig­nif­i­cant mar­ket dis­tor­tion’, al­low­ing in­ves­ti­ga­tors to com­pare ex­port prices with in­ter­na­tional bench­marks, this cer­tainly will af­fect im­ports of Chi­nese prod­ucts,” said Li Guanghui, vice-pres­i­dent of the Chi­nese Academy of In­ter­na­tional Trade and Eco­nomic Co­op­er­a­tion in Bei­jing.

num­ber of US states that saw their ex­ports to China dou­ble over the past decade

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