China warns WTO its cheap exports will soon be harder to resist

Reuters

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A man walks past construction vehicles on display during the China Import and Export Fair, also known as Canton Fair, in the southern Chinese city of Guangzhou October 15, 2015. A man walks past construction vehicles on display during the China Import and Export Fair, also known as Canton Fair, in the southern Chinese city of Guangzhou October 15, 2015.

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China has served notice to World Trade Organization members including the European Union and United States that complaints about its cheap exports will need to meet a higher standard from December 2016, a Beijing envoy said at a WTO meeting.
Ever since it joined the WTO in 2001, China has frequently attracted complaints that its exports are being "dumped", or sold at unfairly cheap prices on foreign markets. Under world trade rules, importing countries can slap punitive tariffs on goods that are suspected of being dumped.
Normally such claims are based on a comparison with domestic prices in the exporting country.
But the terms of China's membership stated that -- because it was not a "market economy" -- other countries did not need to use China's domestic prices to justify their accusations of Chinese dumping, but could use other arguments.
China's representative at a WTO meeting on Tuesday said the practice was "outdated, unfair and discriminatory" and under its membership terms, it would automatically be treated as a "market economy" after 15 years, which meant Dec. 11, 2016.
All WTO members would have to stop using their own calculations from that date, said the Chinese envoy, whose name was not given by a WTO official who spoke to reporters about the meeting.
Dumping complaints are a frequent cause of trade disputes at the WTO, and dumping duties are even more frequently levied on Chinese products.
In September alone, the WTO said it had been notified of EU anti-dumping actions on 22 categories of Chinese exports, from solar power components to various types of steel products and metals, as well as food ingredients such as aspartame, citric acid and monosodium glutamate. The EU was also slapping duties on Chinese bicycles, ring binder mechanisms and rainbow trout.
From the end of next year, such lists would need to be based on China's domestic prices "to avoid any unnecessary WTO disputes", the Chinese representative said.
More than 20 percent of the 500 disputes brought to the WTO in its 20 year history have involved dumping, including several between China and the EU or the United States in the last few years.

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