US says it will fight ‘dis­tor­tions’ caused by China’s econ­omy

Muscat Daily - - BUSINESS -

Wash­ing­ton, US - The US said it will com­bat the ‘dis­tor­tions’ to the world econ­omy cre­ated by China’s eco­nomic sys­tem, es­pe­cially in mar­kets for steel and alu­minium.

In a re­port to Congress, the US Trade Rep­re­sen­ta­tive’s (USTR) of­fice said its pri­mary goal is to de­fend the gov­ern­ment’s abil­ity to im­pose du­ties on China for dump­ing goods at ar­ti­fi­cially low prices or un­fairly sub­si­dis­ing Chi­nese firms. China’s eco­nomic sys­tem, which doesn’t op­er­ate based on mar­ket prin­ci­ples, is hurt­ing Amer­i­can work­ers and in­dus­tries, USTR said in a re­port on its en­force­ment pri­or­i­ties to the

Se­nate fi­nance and house ways and means com­mit­tees.

‘The in­ter­na­tional steel and alu­minium mar­kets, for ex­am­ple, are cur­rently ex­pe­ri­enc­ing sig­nif­i­cant over­sup­ply due in large part to pro­duc­tion from ex­ces­sive and un­eco­nomic ca­pac­ity in China’, USTR said in the re­port, which was dated July 2017 and ob­tained by Bloomberg News.

‘This over­sup­ply has caused se­vere mar­ket dis­tor­tions, in­clud­ing the sup­pres­sion of US and global prices, and the dis­place­ment of US ex­ports in for­eign mar­kets’.

The tough mes­sage on China fol­lows a tense meet­ing in Wash­ing­ton be­tween se­nior eco­nomic of­fi­cials from the world’s two big­gest economies who failed to agree on trade is­sues.

The Com­merce Depart­ment has been in­ves­ti­gat­ing whether steel and alu­minium im­ports rep­re­sent a threat to na­tional se­cu­rity, though Pres­i­dent Don­ald Trump sug­gested last week a de­ci­sion on steel isn’t im­mi­nent.

The Chi­nese gov­ern­ment dis­putes the US po­si­tion that China doesn’t op­er­ate as a ‘mar­ket econ­omy’. Des­ig­nat­ing China a ‘non-mar­ket econ­omy’ en­ables the US to im­pose higher du­ties in re­tal­i­a­tion for dump­ing and un­fair sub­si­dies.

In its re­port, the USTR said it will con­tinue to pri­ori­tise en­force­ment ef­forts in coun­tries where in­tel­lec­tual-prop­erty (IP) pro­tec­tion ‘has de­te­ri­o­rated or re­mained at un­ac­cept­able lev­els’.

The re­port ac­cuses China of ‘wide­spread in­fring­ing ac­tiv­ity, in­clud­ing trade se­cret theft, ram­pant on­line piracy and coun­ter­feit­ing’.

It notes that In­dia and In­done­sia are on the US ‘pri­or­ity watch list’ for IP vi­o­la­tions.

The Chi­nese gov­ern­ment dis­putes the US po­si­tion that China doesn’t op­er­ate as a ‘mar­ket econ­omy’

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