US moves will not cease trade spats, say experts

08:42, September 02, 2010      

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Though the United States has refrained from conducting fresh currency probes and imposing new anti-dumping duties, this does not signal an end to its trade protectionist measures against China, experts said on Wednesday.

China may, in fact, have to contend with a fresh wave of measures in the coming months, due to the slow pace of the US recovery and key elections to the US Congress.

The US Commerce Department on Wednesday rejected an industry proposal to levy duties on imports of aluminum and glossy paper from China.

Trade bodies had sought the duties to compensate them for losses allegedly incurred due to the value of the yuan.

Earlier this year, US manufacturers, in an appeal, said that China's currency moves would help Chinese aluminum and glossy paper makers and exporters.

Ronald Lorentzen, deputy assistant secretary for import administration at the US Commerce Department, said in a statement that the complaints had been rejected because China's currency policy isn't specific to the enterprise or industries being investigated.

Experts on World Trade Organization (WTO) issues, however, said that they are not optimistic about the prospects regarding trade conflicts between China and the US.

"This (the US decision) is not an end to the American complaints on China's currency valuation and subsidies for Chinese products or the investigations into imports from China. The threat is still high," said He Weiwen, standing council member of the China Society for WTO Studies.

He said US manufacturers would launch more trade remedy cases against Chinese products during the rest of the year, despite the slim possibility of trade conflicts between the two sides.

Preliminary duties

The US Commerce Department had earlier on Wednesday announced the ruling on imposing preliminary duties of up to 137.65 percent on imports of aluminum products from China.

The aluminum goods involved in the ruling are those used for doors and window frames and gutters. Under the proposal, most of the Chinese aluminum producers barring two companies will end up paying stiff duties.

The US imported aluminum products worth $514 million from China last year. The Commerce Department is expected to pass its final ruling on the matter in November.

Recent data has revealed that economic growth is slowing in the US, while the jobless rate is galloping. There have also been predictions of the US moving into a double-dip recession. Added to this is the pressure on the incumbent US government to gain confidence from voters ahead of the Congressional elections.

"The US decision (on rejection) is right, but I am afraid they (US) will become more aggressive and hostile to China in the coming months.

Such moves will help US pin the blame for its problems on China and its exports, especially after the Congress recess period ends in mid-September," said Zhou Shijian, a senior economist at the Center for China-US Relations.

But "the US government should be careful about any move against China, considering the recent strides in China-US economic relations. Inappropriate actions would hurt their (US) interests, as well as China's," Zhou said.

During the first seven months of this year, China-US trade surged by 31 percent year-on-year to $207.23 billion, while the nation's imports from and exports to the US grew by 34 and 29 percent respectively.

Last week, the US Commerce Department said it intends to step up enforcement of trade laws against nations like China and Vietnam as they are allegedly subsidizing exports to the US.

Analysts said the move is also part of the US efforts to achieve its goal of doubling exports over the next five years.

Source:China Daily


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