05.15 am, Sunday November 08 2009

US and EU accuse China of unfair trade

07:53 AEST Thu Jun 25 2009
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The United States and the European Union have filed separate unfair-trade cases against China, accusing it of favouring domestic industry by limiting exports of materials needed to produce steel, aluminium and other products.

Beijing defended its curbs as an effort to protect the environment and said they comply with China's World Trade Organisation commitments.

Analysts expect the fight over China's export restrictions will be just one of many trade cases US President Barack Obama's administration files against China.

Obama made campaign pledges to take a tougher approach with US trading partners in the face of soaring job losses and the longest US recession since World War II.

The materials at issue include coke, bauxite, magnesium and silicon metal, the US complaint says.

The US and EU complaints filed with the Geneva-based WTO say China's export restrictions give its companies an unfair edge over their foreign rivals by giving them access to cheaper materials, despite WTO rules against export curbs.

US Trade Representative Ron Kirk said the Obama administration decided to pursue a WTO case after two years of talks between the Chinese and the Bush administration had failed to reach a resolution. He said China's actions were endangering American jobs.

"The United States believes that China is unfairly restricting exports of raw materials," Kirk said. "These actions are hurting American steel, aluminum and chemical manufacturers, among other industries, that desperately need these material to make their products."

Beijing said it hoped to resolve the dispute through dialogue in the WTO.

The US and EU complaints trigger a 60-day consultation period. If the dispute is not resolved, they can formally request a WTO hearing panel. At that point, the cases likely would be merged.

 
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