U.S. May File WTO Complaint Over China's Export Restrictions on Raw Materials Used to Produce Steel
The Financial Times reported today that the United States Trade Representative is close to filing a complaint against China in the World Trade Organization challenging China's export restrictions on raw materials used in steel-making and other industries.
The article states:
The US has been working on the case intensely for the past few months, and could move ahead with a request for consultations – the first step in the WTO dispute settlement process – within weeks, according to people close to the discussions.
A WTO fight over China’s treatment of raw materials would shake up the global steel and chemicals industries, where China has emerged as a leading producer and competitor to western companies in recent years.
The final decision has yet to be made but a move by the US before the presidential election in early November would support Republican claims that the Bush administration has not been shy about bringing WTO cases against China that it believes it can win. Amid increasing scepticism about the benefits of trade in the US, Democrats in Congress have attacked the administration for being too lax on trade enforcement.
The US is expected to argue that Chinese export quotas and taxes on raw materials such as metallurgical coke, molybdenum, silicon carbide and fluorspar used in steel production artificially deflate domestic prices and inflate global prices, putting US producers at a disadvantage in violation of WTO rules.
US officials have spent the past several months narrowing the focus of a potential case from an initial list of more than a dozen raw materials to a handful of products where the US is confident that China breached the “protocol of accession” it signed on joining the WTO in 2001, one person familiar with the matter said. Other items that have been considered include zinc, bauxite and antimony.