US trade bill breaks WTO rules

Trade measures passed by the US Congress violated both US laws and World Trade Organization rules, Chen Deming, minister of commerce, said on Wednesday. The US House of Representatives passed a measure on Tuesday confirming that the Commerce Department could impose higher duties on goods from China for, they claimed, subsidizing exports. The Senate passed it on Monday. At a press briefing during the National People's Congress, Chen said that the government had been "abiding by" WTO rules in terms of subsidies. "The US always likes to point a finger at China and say 'China is not abiding by the rules' when its own economy is encountering problems," Chen said. But it seldom elaborates exactly what rules are being broken, he added. His remarks followed the 370-39 vote in the House of Representatives in favor of the bill to impose countervailing duties on goods. The bill was in response to a ruling by the US Court of Appeals for the Federal Circuit last December that stated that US countervailing duty law, (imposing trade penalties) cannot be applied to what it described as "non-market economies". The legislation will now be passed to US President Barack Obama to sign. "Such behavior is not in line with international trade rules, nor is it in line with American law," Chen said. The government, according to Chen, has not provided any subsidies that "are prohibited by the global trade arbitrator", and "we are willing to consult with the US on the issue, if there are any problematic subsidies by local governments," he said. Chinese trade experts said that the US is merely politicizing the issue as it is considered a vote-getter during election year. The US has pumped large funds into, and subsidized, many of its domestic industries since the onset of the financial crisis in 2008 but China has not criticized this or launched investigations, Chen said. Those nations blaming others for subsidies should correct their own behavior, Chen said. "There is a Chinese saying: Do not impose onto others what you would not like imposed onto you." The US Commerce Department has levied $5 billion in countervailing duties on Chinese imports since 2006 involving a wide range of industries, including tires, steel, aluminum, paper and chemicals. Sun Zhenyu, China's former ambassador to the WTO, said an appeal must be considered. "It's hard to predict, but China must appeal to the WTO if the bill is eventually signed by Obama. China must be tough on the issue." Some American organizations voiced opposition to the bill. The Club for Growth, an anti-tax advocacy group based in Washington, said that "these duties restrict economic liberty and are anti-growth". They had called on Congress to defeat the measure.