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 user 2007-04-02 at 10:07:00 am Views: 31
  • #17667

    U.S. Readies Sanctions Against China
    (APRIL 07) – The Bush administration, facing increasing anger over
    soaring trade deficits, says it will impose sanctions against Chinese
    paper imports, which would open a new avenue for beleaguered American
    manufacturers to seek government protection.The action, announced
    Friday by Commerce Secretary Carlos Gutierrez, reverses 23 years of
    U.S. trade policy by treating China, which is classified as a nonmarket
    economy, in the same way other U.S. trading partners are treated in
    disputes involving government subsidies.The decision involved a case
    brought by NewPage Corp., a paper company. It contended that its coated
    paper, used in printing glossy catalogues and annual reports, was
    facing unfair competition from imports from Chinese companies that
    receive improper subsidies from the Chinese government.Commerce imposed
    penalty tariffs ranging from 10.9 percent to 20.4 percent on imports of
    glossy paper from China. The tariffs will take effect next week on a
    preliminary basis and will become final after a further Commerce review
    is completed in June.The action was being watched closely by many other
    American companies, from steel to furniture, that were battered in
    recent years as Chinese imports flooded the United States.U.S.
    companies always have been allowed to file antidumping cases to seek
    penalty tariffs on grounds that the Chinese products were being sold in
    the United States below cost.With Friday’s action, however, they also
    will be able to seek penalty tariffs, known as countervailing duties,
    on the basis of improper government subsidies such as favorable loans
    from state-owned Chinese banks to direct government support.”The United
    States today is demonstrating its continued commitment to leveling the
    playing field for American manufacturers, workers and farmers,”
    Gutierrez said in announcing the decision.

    The Chinese government criticized the administration decision.
    action of the U.S. side goes against the consensus reached by the
    leaders of both countries to resolve disputes through dialogue,” said
    Wang Zinpei, a spokesman for China’s Ministry of Commerce, quoted by
    the Xinhua News Agency. “China strongly requires the U.S. side to
    reconsider the decision and make prompt changes.”Daniel Porter, a
    Washington attorney representing the Chinese government, said no
    decision had been made yet whether to appeal a federal court ruling on
    Thursday that gave the Commerce Department the go-ahead to invoke the
    sanctions.The decision by Commerce represented the latest effort by the
    administration to adopt a tougher approach to Chinese trade practices
    as the administration faces growing pressure from Democrats, who now
    control both the House of Representatives and the Senate.The
    administration filed a case against China with the World Trade
    Organization this year alleging that China was violating WTO rules by
    giving its companies improper subsidies for production of steel, paper
    and other products.

    U.S. lawmakers, businesses and unions praised the action in the NewPage case.
    a joint statement, House Ways and Means Committee Chairman Charles
    Rangel and Rep. Sander Levin, both Democrats, called the sanctions a
    “long-overdue change in policy.” They said they intended to push
    forward with legislation that would explicitly change U.S. law to make
    sure the Commerce actions will withstand any court challenges.Leo
    Gerard, president of the United Steel Workers union, said the Commerce
    action was welcome news for workers at 22 paper mills in 13 states who
    produce the glossy paper covered by the sanctions. Gerard’s union
    represents 90 percent of the work force in the U.S. coated paper
    industrGilbert Kaplan, a Washington attorney representing NewPage, said
    the Commerce action reflected the reality that China, as a major power
    in the global economy, “should not be exempt from the laws that ensure
    fair trade.”When the Bush administration made it known last year that
    it was willing to consider cases against China involving government
    subsidies, it was seen as an effort to bring more pressure to bear on
    the Chinese to adhere to the rules of the WTO, which China joined in
    2001.Treasury Secretary Henry Paulson is leading an effort to pressure
    China to let its currency rise in value against the dollar. American
    manufacturers contend that China keeps its currency devalued by as much
    as 40 percent to give the country unfair trade advantages.