News, events and analyses related to global trade and snippets of changing trade matrix during the month of January 2017
Not so ‘market’able
It seems, for China, to be recognised as a market economy will take more than the stipulated 15 years. China that joined WTO on December 11, 2001 had agreed to be treated as a non-market economy (NME) for 15 years, after which it would get the market economy status (MES). However, EU, US and Japan have refused to play ball when the 15 years were over.
Most of China’s trading partners believe that the country does not operate on a free market economy basis, and a large number of products exported by China are in some manner or the other subsidised by the government. A market economy status would mean that it would be much more difficult to impose anti-dumping duties on China, and expose domestic producers to unfair competition from Chinese manufacturers.
Chinese media held Japan responsible for the turn of event, calling it ‘a new wave of mistrust in East Asia’. However, both US and EU have also refused to change the protocol by which they evaluate China’s market economy status. The US in December imposed anti-dumping tariffs on Chinese washing machines. The European Commission had originally favoured the granting of market economy status to China, but the slew of anti-dumping cases regarding steel products has forced it to change its stance. Approximately half of EU’s anti-dumping investigations concern non-market economies (NMEs), of which about 85% involve imports from China.
As for India, which is China’s ninth largest exports destination, an MES status for China could have a devastating effect on domestic producers. India too has, over the years, imposed anti-dumping duties on a cross-section ...
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