Shadows of Protectionism - Obama's Visit Not a Moment Too Soon
The European Union's trade commissioner, Catherine Ashton, claimed in a document released last week that despite 223 restrictive trade measures since October 2008, a protectionist worst-case scenario has been avoided, especially as the Group of 20 leaders made commitments to protect free trade. Yet a spokesman from China's Ministry of Commerce over the weekend proclaimed that China has suffered heavily from trade protectionism, which has been rising since the start of the financial crisis. And he gave some stats to back it up. In the first 9 months of the year, the spokesman said, 19 economies launched 88 probes into Chinese products, involving USD10.2 billion worth of export goods. The number of probes is up 29% compared to the same period last year, while the monetary value is up a full 125%. The 88 probes against Chinese products included 57 anti-dumping cases, nine of anti-subsidy and 15 safeguard actions and 7 cases of special protection. The spokesman particularly singled out the United States - responsible for 14 of the 88 probes with a value of USD5.84 billion, an increase of 639% y-o-y.
According to data from the WTO's Global Antidumping Database, in Q3 2009 WTO member governments initiated 44 new product level investigations in response to domestic industry requests for the imposition of import restrictions, most of these (37) occurred under a national antidumping law. The cumulative number of new requests for protection during the first three quarters of 2009 was 30.3% higher than for the same period in 2008, and China continued to be the exporting country most targeted by new investigations in Q3, facing 23 (or 62.1%) of 37 new product-level investigations. For the whole of 2008, industry demands for new import restrictions against China under these policies were up 22.7%, while a 7.8% increase is expected in 2009. Interestingly, however, in the report accompanying the data, author Chad Bown concludes that
According to data from the WTO's Global Antidumping Database, in Q3 2009 WTO member governments initiated 44 new product level investigations in response to domestic industry requests for the imposition of import restrictions, most of these (37) occurred under a national antidumping law. The cumulative number of new requests for protection during the first three quarters of 2009 was 30.3% higher than for the same period in 2008, and China continued to be the exporting country most targeted by new investigations in Q3, facing 23 (or 62.1%) of 37 new product-level investigations. For the whole of 2008, industry demands for new import restrictions against China under these policies were up 22.7%, while a 7.8% increase is expected in 2009. Interestingly, however, in the report accompanying the data, author Chad Bown concludes that
So protectionism may have been on the increase since the financial crisis - yet the targeting of Chinese exporters in this regard is nothing new. The series of anti-dumping duties recently levied in the US on imported Chinese products (notably on tires and steel pipe) have, however, caused the contentious shadow of protectionism to fall squarely over US President Obama's impending visit to China. The Chinese have countered with tariffs and investigations of their own, notably on whether cars imported from the US are being sold below market prices in China, yet surely these matters can all be talked out in a civilised manner when the two finally sit down for what is now a well overdue chat.WTO member use of trade remedies to target China's exports is not a new, crisis-related phenomenon, as it continues a trend dating back to China's WTO accession in 2001 and even earlier.
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