U.S. complains to WTO about China's export limits
— -- The United States and the European Union on Tuesday accused China of unfairly restricting the export of raw materials used to make products from baseball bats and contact lenses to automobiles and semiconductor chips.
In a complaint filed with the World Trade Organization in Geneva, the U.S. said China uses quotas and tariffs to limit its exports of nine materials, including essential inputs for the steel, aluminum and chemical industries. China agreed to eliminate the measures in 2001 when it joined the WTO, according to Ron Kirk, the chief U.S. trade negotiator.
"This appears to be a conscious policy to create unfair preferences for Chinese industries by making raw materials cheaper for China's companies to get and goods more economical for them to produce," Kirk said.
In one case, China last year limited its overseas shipments of a substance known as coke, which is used to make steel, to just 12 million metric tons — a sliver of its 336 million metric ton annual production, Kirk said. Along with significant export duties, the measure drove the world price of a ton of coke to $740 vs. just $472 in China.
The American Iron and Steel Institute and the United Steelworkers Union said in a joint statement that the Chinese policies are causing U.S. companies "significant harm." The Chinese embassy in Washington had no immediate comment.
The latest trade spat is the eighth time the U.S. has gone to the WTO over China's trade practices and the first time since President Obama took office vowing a tougher line on U.S. trade partners. China has filed four complaints against the U.S.
U.S. officials tried for two years to persuade China to abandon the export limits on bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, yellow phosphorous and zinc. Under WTO rules, Tuesday's complaint formally requests consultations, which often lead to sudden settlements. "I wouldn't be surprised if that happened in this case," said David Spooner, a former Bush administration trade negotiator.
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