Obama Admin drags China to WTO on auto subsidies
Washington: The US and China Monday levelled trade distortion charges on each other at the WTO, with the former dragging Beijing to the trade body on its auto parts subsidy programme and the latter retorting with a challenge on American anti-dumping measures on a series of goods.
Adding to the already bitter trade relations between the two countries, the Obama Administration announced Monday that it would take China to the World Trade Organisation alleging that it provided a subsidy of USD 1 billion to its auto-export industry between 2009 and 2011.
US Trade Representative Ron Kirk said the US has requested dispute settlement consultations with the Government of China at the WTO concerning China's auto and auto parts "export base" subsidy programme.
Under the programme, China provides extensive subsidies to auto and auto parts producers located in designated regions, known as "export bases," that meet export performance requirements.
Kirk said the Chinese programme appears to provide export subsidies that are prohibited under WTO rules because they severely distort trade.
In return, China filed a WTO case against the US, accusing it of imposing anti-dumping measures on billions of dollars of kitchen appliances, paper and other goods.
The Chinese Ministry of Commerce said its complaint revolves around the US Congress's passage of a law that gave the Commerce Department power to impose anti-dumping duties on Chinese goods retroactively.
"This practice puts Chinese enterprises in an uncertain legal environment, in violation of the relevant rules of the WTO transparency and due process," said ministry spokesman Shen Danyang in a statement.