U.S. to Re-Examine China's Nonmarket Economy Status
03/30/2017 - The U.S. Department of Commerce will review whether China should continue to be treated as a nonmarket economy in trade cases.
The department, which disclosed its intention in a document related to an investigation into dumped aluminum foil from China, said it would begin the review by accepting public comment on the matter.
China’s ascension agreement with the World Trade Organization allows member nations to classify China as a nonmarket economy in trade cases, which means that they can apply a less favorable set of numbers in setting dumping margins on Chinese goods.
That typically has resulted in higher tariffs, and has been source of irritation among Chinese officials.
Although the U.S. and the European Union continue to peg China as a nonmarket economy, China argues that the clause allowing for the distinction expired in December 2016. It has filed complaints with the World Trade Organization over its continued use.
In a statement Thursday, the United Steelworkers union said it supports the review and believes the appropriate outcome would be for the government to continue to treat China as a nonmarket economy.
“While more than a decade has passed (since the last review), the USW's experience with China makes it clear that its non-market economy continues. Granting China market economy status would be contrary to the facts as well as serving to devastate domestic producers and workers,” United Steelworkers International President Leo W. Gerard said in a statement.
"The preferential status China is seeking would allow them to dump more unfairly priced products into the market, while claiming to abide to market economics. Nobody who understands China's economic policies, and deals with the reality of those policies in the marketplace, can honestly argue that China is a market economy.”
He Weiwen, deputy director of the Beijing-based Center for China and Globalization and a former business attache in the Chinese consulates of New York and San Francisco, told the Bloomberg news service that although the U.S, is undertaking a review, the outcome is probably a foregone conclusion, given all of President Donald Trump’s past rhetoric on trade.
China’s ascension agreement with the World Trade Organization allows member nations to classify China as a nonmarket economy in trade cases, which means that they can apply a less favorable set of numbers in setting dumping margins on Chinese goods.
That typically has resulted in higher tariffs, and has been source of irritation among Chinese officials.
Although the U.S. and the European Union continue to peg China as a nonmarket economy, China argues that the clause allowing for the distinction expired in December 2016. It has filed complaints with the World Trade Organization over its continued use.
In a statement Thursday, the United Steelworkers union said it supports the review and believes the appropriate outcome would be for the government to continue to treat China as a nonmarket economy.
“While more than a decade has passed (since the last review), the USW's experience with China makes it clear that its non-market economy continues. Granting China market economy status would be contrary to the facts as well as serving to devastate domestic producers and workers,” United Steelworkers International President Leo W. Gerard said in a statement.
"The preferential status China is seeking would allow them to dump more unfairly priced products into the market, while claiming to abide to market economics. Nobody who understands China's economic policies, and deals with the reality of those policies in the marketplace, can honestly argue that China is a market economy.”
He Weiwen, deputy director of the Beijing-based Center for China and Globalization and a former business attache in the Chinese consulates of New York and San Francisco, told the Bloomberg news service that although the U.S, is undertaking a review, the outcome is probably a foregone conclusion, given all of President Donald Trump’s past rhetoric on trade.
