WTO gives US deadline to fix anti-China practices
US ‘erred’ in backing WTO entry for China, Russia: USTR
GENEVA: A World Trade Organization arbitrator on Friday gave Washington until August 22 to implement a prior ruling faulting the anti-dumping measures taken against Chinese products.
The WTO’s Dispute Settlement Body ruled last May that some of the US anti-dumping practices were inconsistent with international trade rules. Arbitrator Simon Farbenbloom said in a report that it was “reasonable” to expect the United States to implement the ruling within 15 months.
“The reasonable period of time for implementation will expire on 22 August 2018,” he said. The case dates back to December 2013, when China filed a dispute against the United States, taking issue with the way Washington assesses whether exports have been “dumped” at unfairly low prices onto the US market. The use of anti-dumping duties are permitted under international trade rules as long as they adhere to strict conditions, and disputes over their use are often brought before the WTO’s Dispute Settlement Body.
In this specific case, China alleged that the United States, in violation of WTO rules, was continuing a practice known as “zeroing”, which calculates the price of imports compared to the normal value in the United States to determine predatory pricing. In October 2016, a panel of WTO experts found largely in China’s favor in the case, including on the issue of “zeroing”. The United States, which has repeatedly lost cases before the WTO over its calculation method, said in June 2017 that it would implement the panel’s recommendations, saying it would do so within a “reasonable” time frame.
This prompted China to ask the WTO to appoint an arbitrator to set an end date. The 162-member Geneva-based WTO aims to create a level playing field in global trade, although US President Donald Trump’s trade envoys maintain the organization has given unfair advantages to China at the expense of the United States.
US support
China and Russia have shown no intention of living up to World Trade Organization rules and Washington should not have supported their membership in the global trade body, the Trump administration said on Friday.
In strongly worded reports to Congress, the US Trade Representative delivered a laundry list of grievances over unfair trade practices by Beijing and Moscow it says runs counter to global free trade rules.
USTR Robert Lighthizer said the reports show “the global trading system is threatened by major economies who do not intend to open their markets to trade and participate fairly.”
“This practice is incompatible with the market-based approach expressly envisioned by WTO members and contrary to the fundamental principles of the WTO,” Lighthizer said in a statement.
President Donald Trump has ratcheted up retaliatory measures against foreign trading partners, notably China, as part of his America First economic agenda which lifted him to power a year ago. That included an aggressive new trade probe into possible dumping of aluminum and steel.
The US had a $309 billion trade deficit in goods and services with China in 2016, and that was on track to expand by $10 billion last year.
USTR report said after joining the WTO in 2001, Beijing effectively abandoned efforts to adopt market-friendly reforms and instead increased central government control over commerce while erecting barriers to foreign competition. But WTO rules are insufficient to correct Beijing’s interventionist policies, and the United States “erred” in supporting China’s membership in 2001, the report said.
US dialogue with Beijing since Trump took office yielded some results, such as renewed access to Chinese markets for US beef, but these were piecemeal changes, the report said. “China is determined to maintain the state’s leading role in the economy and to continue to pursue industrial policies that promote, guide and support domestic industries while simultaneously and actively seeking to impede, disadvantage and harm their foreign counterparts,” the China report said. Chinese authorities also continue to pressure American companies into sharing valuable intellectual property, the report said.
The USTR likewise accused Moscow of an
China alleges US zeroing practice
“accelerating withdrawal” from the open market system demanded by WTO membership since joining in 2012, citing burdensome import licensing, opaque customs regimes, and barriers to agricultural imports. “It was a mistake to allow Russia to join the WTO if it is not fully prepared to live by WTO rules,” the report said.