Trade cases against China on the rise

11/08/2009 12:00 - 606 Views

With major economies shrinking worldwide, and what could be a global problem with unemployment, many countries are taking a protectionist stance to shield businesses at home from overseas competition. According to one trade expert, the current dispute over Chinese tires is just another example of this shift in sentiment.

Anti-dumping means measures taken by a government to protect its industries from what it considers to be unfair competition from imports sold at a below cost price. This would normally involve placing additional tariffs on the imports concerned.

Countervailing means duties imposed by a government when a foreign country subsidizes its exports, hurting domestic producers in the importing country.

Both anti-dumping and countervailing normally involve investigations that last one to two years. But experts say safeguard mechanism is even more damaging to the interest of exporters.

Zhou Shijian, executive director of China National Institute of WTO, said, "the safeguard mechanism is even worse for exporters because the measures can be very damaging and approved during a very short time."

The safeguards are contingency restrictions on imports taken temporarily to deal with special circumstances such as a surge in imports. Safeguard measures may involve both higher duties and import quotas.

Zhou said, "The reason for rising protectionism is the economic recession. When the world economy was good, both supply and demand were flourishing and there was little conflict. Now the demand has decreased, suppliers like China are blamed and have to suffer."

According to the Ministry of Commerce, from January to May, 13 countries launched 38 trade protection cases against China, an increase of 26 percent.

Editor: Liu Fang | Source: CCTV.com



Source: www.cctv.com
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