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Industry refutes govt subsidy claims

By Song Shengxia (Global Times)

08:06, May 03, 2012

Chinese industrial bodies yesterday dismissed US accusations that the Chinese government is unfairly subsidizing high-pressure steel cylinder exports, and urged the US authorities to carefully assess the case to avoid misuse of trade relief measures in their final affirmative injury determination due next month.

"The final ruling by the US Commerce Department to levy anti-dumping and countervailing duties on high-pressure steel cylinders from China is totally unreasonable and amounts to trade protectionism. Chinese producers have never received government subsidies," Fu Chungan, secretary-general of the China Gas Industry Association, told the Global Times yesterday.

According to Fu, China's high-pressure steel cylinder market is also very competitive and open, where numerous private players compete freely.

"The US company which lodged complaints against Chinese producers is a small company which has no competitive edge over their Chinese counterparts and its views cannot represent an entire industry in the US," he said, "We hope the US authorities could drop the punitive duties on Chinese products in their final ruling."

The US Commerce Department on Tuesday announced anti-dumping duties ranging from 6.62 percent to 31.21 percent and additional countervailing duties of 15.81 percent on high-pressure steel cylinders from China.

Before the duties can take effect, the US International Trade Commission (ITC) will have to find whether imports from China are materially injuring the US producers, with a final decision expected before June 11.

"The final ruling by the ITC is vitally important for our overseas business development. If the ruling is against us, our US customers, some of whom have been doing business with us for almost 20 years, will have to either pay higher cost for our products or find suppliers in other countries," Han Huizong, a spokesman of Beijing Tianhai Industrial Co, the only mandatory respondent in the case, told the Global Times.

Han said the company's exports to the US account for up to 70 percent of the total exports from China, and it is now looking to diversify its market to mitigate huge losses from a possible negative ruling.

The petition was filed last year by Texas-based Norris Cylinder Company, the last remaining producer of high-pressure steel cylinders in the US, which asked for anti-dumping duties of up to 176.25 percent and additional countervailing duties on these products from China, designed to store gases at high pressure during transportation.

In 2011, US imports of steel cylinders from China were valued at an estimated $81.7 million.

"China has been facing serious trade conflicts since last year amid a sluggish global economy. The US has stepped up protectionist practices during its presidential election year," said Bai Ming, a researcher with the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce.

In 2011, China faced 69 cases of trade investigations by foreign countries against its exports, and 17 Section 337 investigations by the US with the total value of $700 million.

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