US, China swap more tariffs

08:21, February 08, 2010      

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China and the United States cranked up the tension Friday as they exchanged new tariffs, underscoring the increasing sensitivity and fragility of the world's most significant bilateral relations, which have been strained in recent weeks.

China's ministry of commerce announced duties on imports of US chicken products Beijing believes are sold at unfairly low prices. In its preliminary ruling, the ministry asked importers of US chicken parts in China to pay deposits at customs – of up to 105.4 percent – starting Saturday, according to an online statement.

"Investigations showed that the US producers had dumped chicken products on the Chinese market, causing substantial damage to China's domestic industry," the ministry said.

Later Friday, the US unveiled its countermeasure by slapping initial anti-dumping duties of up to 231.4 percent on gift boxes and ribbons from China that it said were unfairly priced, Reuters reported, adding that the US slapped much lower duties of up to 4.54 percent on Taiwan.

China formally launched anti-subsidy investigations into US chicken products and auto parts in late September. That move came as the US imposed stiff tariffs on imported Chinese tires, adding to a growing list of Chinese exports that face US duties, including electric blankets and steel tubes.

As much as $7 billion worth of Chinese exports last year were made subject to Washington's trade protectionist measures, Yao Jian, a spokesman with China's ministry of commerce, said in January, with the steel and tire industries said to be among the most affected.

A government-linked think tank in China said over the weekend that foreign trade is to observe a "marked" recovery as overseas demand rises due to the global economic recovery.

Foreign trade will see a 17.6 percent year-on-year growth, with exports up 16.6 percent and imports up 18.9 percent, the Center for Forecasting Science of the Chinese Academy of Sciences said in a report issued Saturday.

China accounted for 19 percent of US imports in the first half of 2009, up from 16 percent in 2008, according to US Census Bureau figures, the Wall Street Journal reported Friday.

The US trade deficit with China in the first 11 months of last year, however, was $209 billion, a 16 percent drop from a year earlier, which was $248 billion, according to statistics from the US Census Bureau.

US President Barack Obama made an ambitious pledge to double US exports over the next five years in his recent State story of the Union address.

Goldman Sachs estimates that such a scenario might require a 4.5 percent average annual global GDP growth accompanied by a 30 percent US dollar depreciation, Reuters said Friday in a commentary.

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