WTO Opposes US Steel Measures

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Last updated at: (Beijing Time) Tuesday, July 15, 2003

WTO Opposes US Steel Measures

Safeguard measures imposed by the United States on imports of certain steel products are inconsistent with the World Trade Organization's (WTO) rules, a WTO panel concluded on Friday.

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Safeguard measures imposed by the United States on imports of certain steel products are inconsistent with the World Trade Organization's (WTO) rules, a WTO panel concluded on Friday.

The eight opponents of the US measures - the European Union, Japan, South Korea, China, Switzerland, Norway, New Zealand and Brazil - immediately welcomed the panel's decision in a joint statement.

They also called on the United States to immediately cancel its safeguard measures.

If the United States appeals, the eight suitors will continue to work together to push for the WTO to retain the panel's present decision, the statement said.

If the United States decides not to appeal, the WTO trade dispute settlement body will soon adopt the panel's conclusion and put an end to the year-long trade dispute.

That also means China, one of the suitors, is to win its first trade dispute under the multilateral trading system.

But industry and trade experts and lawyers said the victory is largely symbolic.

An attorney with a Beijing-based foreign law firm said he and many other lawyers have expected the United States to lose the case at the WTO.

But the victory would have come too late because by the time the case is concluded, the damage would already have been done to trade liberalization and the world's steel industry, said the attorney who declined to be named.

He said the United States, knowing clearly it will lose, has taken advantage of the time span for the WTO to judge to protect its steel industry.

More dangerous than the safeguard measures themselves are the US Government's inclination towards trade protectionism, said Chinese trade officials.

The United States is a pioneer of trade liberalization in the WTO Uruguay Round as well as a major beneficiary. Its leanings towards trade protectionism poses severe threats to the ongoing Doha round of WTO talks, they said.

The US safeguard measures have done little substantial damage to Chinese steel industries, which depend largely on the domestic market, said officials from the China Association for Iron and Steel Industries.

China exports only about US$150 million in iron and steel products to the United States annually, according to statistics from the association.

They said China's participation in suing the US is more a practice of making use of the WTO trade dispute settlement body to legally protect domestic industries.

As a new WTO member, such on-the-job training is very necessary to get China familiar with the procedure and techniques, they said.

China is the world's largest victim of the abuse of WTO-allowed measures to protect domestic industries, including anti-dumping, anti-subsidy and safeguard measures.

The latest WTO statistics reported that China, with 27 investigations on its exports, is at the top of the list of countries subject to anti-dumping investigations between July 1 and December 31, 2002, although this number is a slight decrease from the 29 investigations launched on Chinese exports during the second half of 2001.

Exports from China were also the subject of the largest number of final measures, 18 in total, imposed during the second half of 2002, though this represents a slight decrease from the 21 measures imposed against its exports during the second half of 2001.

Until the end of last October, 33 countries and regions have started 502 anti-dumping cases against China, involving US$16 billion in Chinese exports, according to the latest statistics from the Ministry of Commerce.

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