Xinhua Insight: Chinese lawmakers slam U.S. trade bill as protectionism
BEIJING, March 7 (Xinhua) -- Chinese lawmakers on Wednesday joined in a wave of criticism against the passage of a bill by the United States Congress to empower the country's Department of Commerce to impose countervailing duties on Chinese imports, warning that such moves will cause "materialized damage" to Sino-U.S. trade relations.
China's swift and strong response came after the U.S. Senate and House of Representatives passed a bill to allow the Department of Commerce to impose countervailing duties on imports from China and Vietnam.
"Such moves harm others and will do no good for themselves," said Chang Dechuan, a deputy to the National People's Congress, China's top legislature.
The renewed tariff bill by the U.S. side not only departs from norms governing international trade, but also undermines the business interests of China, said Chang, who is also president of the Qingdao Port, one of China's biggest ports.
The bill does no good to help rejuvenate industries in the United States or increase job opportunities, but adds to the burdens of U.S. consumers, Chang said.
The U.S. bill came in response to a U.S. Federal Court ruling on Dec. 19, 2011, stating that the U.S. Commerce Department does not have the legal authority to impose countervailing duties on goods from non-market economy countries.
The U.S. court explained that government payments cannot be characterized as "subsidies" in a non-market economy context, saying the Obama administration lacked legal ground to impose a three-year tariff on imports of low-grade Chinese tires in September 2009, which U.S. authorities claimed enjoyed unfair government subsidies.
The U.S. does not recognize China as a market economy.
Both the U.S. House and the Senate acted quickly after the hearing to introduce a bill to remedy the Tariff Act of 1930 and overturn the Federal Court's decision.
Aiming to increase job opportunities in its domestic tire industry, the United States has imposed special protectionist tariffs on Chinese tire imports since 2009, but this has only increased the burden for U.S. consumers.
According to a report by the U.S.-China Business Council in August 2010, though the market share of U.S. tire imports from China dropped to 24 percent in June 2010 from a peak of 45 percent before the imposition of the special protectionist tariffs, prices of tires rose about 10 to 20 percent in the United States.
Also, in the first five months of 2010 after the special tariffs were enacted, the tire manufacturing industry continued to lose 10 percent of its jobs from a year before, according to data from the U.S. Department of Labor.
Huang Ming, another NPC deputy and chairman of Qingdao-based Himin Solar, said he was worried that the United States would adopt further protectionist measures against more Chinese products, which will cause greater harm to Sino-U.S. bilateral economic ties.
Currently, the United States is starting anti-dumping and anti-subsidy investigations against China-made solar plate and wind power turbine components.
Chinese Minister of Commerce Chen Deming said at a press conference on Wednesday that the U.S. bill is not in line with international rules and must be corrected.
Chen reiterated that China will only follow the rules of those international organizations it has joined. In terms of economics and trade, for example, China has followed the rules of the World Trade Organization since acceding to the WTO 11 years ago, Chen said.
"But we don't have the obligation to abide by any domestic laws and regulations that are not in line with the rules of international organizations," Chen said.
Chen said he "can't understand" why the United States has imposed high tariffs on imports from China in the form of 31 anti-dumping and anti-subsidy measures and failed to correct its own mistakes according to the court ruling.
The minister said China hopes to discuss the issue with countries that have accused China of giving out prohibitive subsidies.
Guo Guoqing, a professor with Renmin University, said the United States is obviously conducting a "double standard" by keeping its domestic laws above international regulations and placing its own benefit above that of other countries.
Properly subsidizing domestic enterprises is a "common practice" for governments worldwide to boost their competitiveness, said Guo.
For example, the United States offered generous subsidies to its automobile industry that suffered a crisis during the global financial turbulence, he said.
The passage of the new tariff bill came at a time of a tough election battle in the United States, which made China an easy target for U.S. politicians looking to win more votes by politicizing trade issues.
The intention has turned more explicit when one week ago the U.S. government established the Interagency Trade Enforcement Center, which is expected to coordinate the enforcement of U.S. trade rights under international trade agreements and the enforcement of domestic trade laws, according to a previous statement from the White House.
Jia Qingguo, deputy director of the School of International Studies at Peking University, said U.S. politicians are eager to find a target to attack as domestic economic recovery and employment conditions remain weak.
China and its exports are a perfect "scapegoat," he said.
The G20 countries, including China and the United States, have agreed on opposing trade and investment protectionism worldwide, but the new tariff is "a flagrant violation" of the G20 consensus, said Chen Dezhan, a professor with Shandong Normal University.
Chinese lawmakers noted that the restrictive measures could only lead to China's retaliation and trigger a trade war between the world's two largest economies, therefore undermining global economic recovery.
Chinese Vice President Xi Jinping also called on the United States to address the China-U.S. trade imbalance during his visit to the U.S. last month.
"It is very important for the United States to adjust its economic policies and structure, including removing various restrictions on exports to China, in order to address the trade imbalance," Xi said.
China and the United States remain the second largest trading partner for each other.