China counter-challenges U.S. over subsidies
China filed a complaint at the World Trade Organization on Friday to challenge U.S. tariffs charged on Chinese goods that the United States considers to be unfairly subsidized.
The dispute, revolving around so-called countervailing duties, relates to 22 products with an annual export value to the United States of $7.3 billion, China’s mission to the WTO said in an emailed statement.
There was no immediate reaction from U.S. officials. China did not name the products subject to countervailing duties.
The case begins with China “requesting consultations” with the United States to try to find an amicable settlement. But it may later move to arbitration if the two cannot agree, and the United States could be forced to scrap its duties and even compensate China if it is found to have broken the rules.
The dispute adds more heat to a trade relationship that has barely stopped simmering despite the United States seeing signs of China “making progress” towards easing restrictions on its currency, one of the biggest causes of friction.
Although China’s pace of overall export growth has slumped to single digits this year, the trade deficit with the United States set an annual record of more than $295 billion in 2011, putting extra pressure on U.S. manufacturers whose markets are still recovering from the financial crisis.
The latest complaint comes just eight days after the U.S. Commerce Department set punitive tariffs on Chinese solar panels that it said Chinese exporters had dumped at unfairly low prices on the U.S. market. China’s Commerce Ministry said the U.S. action violated WTO rules and distorted trade.
Two more trade disputes are due to be ruled on by WTO dispute panels within days or weeks. One concerns China’s exports of grain-oriented electrical steel.
The other is a U.S. complaint about China closing its electronic payments market to firms such as VISA, Mastercard and American Express, and giving a monopoly to China UnionPay.
China’s statement said the latest case was launched because the United States had broken WTO rules in many areas, including rules regarding “public body, specificity, facts available and subsidy finding on the export restriction measures.”