SHANGHAI (Reuters) - China on Saturday hit back at U.S. government action to investigate a labor union's charges that it subsidizes its green technology producers, saying the move sends a wrong signal on trade protectionism.

The U.S. probe will look into whether Chinese support for its clean energy sector was a violation of World Trade Organization rules, as requested by the United Steelworkers Union.

China's commerce ministry said in a statement the charges by the union were "groundless and irresponsible" and it regretted that the U.S. government agreed to open investigations.

"The U.S. government's acceptance of the appeal and its decision to launch a probe into the issue is sending a wrong signal of trade protectionism to the rest of the world," an unnamed official with the commerce ministry's division to safeguard fair foreign trade said in a statement on its website (www.mofcom.gov.cn).

The official said the United States was also promoting its energy sector and more than 2,300 projects, including those related to clean energy, were eligible for government subsidies.

"As such, the U.S. has no reason to blame other countries' efforts to improve the well-being of mankind."

China will protect its rights and interest in accordance with WTO rules, the official said.
The U.S. decision, unveiled nine days before it was due on October 24, came on the same day as the Treasury Department's announcement that it was putting off for at least one month a report on whether China is manipulating its currency for an unfair trade advantage.

The U.S. Treasury said it was delaying its semi-annual report on foreign exchange rate practices until after a pair of international summits in November to give diplomatic pressure on China more time to achieve results.

Democratic lawmakers hailed the action as a sign of President Barack Obama's determination not to let China use unfair trade practices to dominate global production of solar panels, wind turbines and other green technologies.

A U.S. trade panel granted on Friday final approval to steep import duties on hundreds of millions of dollars of steel pipes from China to offset government subsidies and other unfair trade practices.