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US dumping probe smacks of protectionism: experts

By Jiang Wei (China Daily)
Updated: 2009-07-02 09:45

Three anti-dumping and countervailing investigations into imports of Chinese steel products in 10 days have sparked concerns of rising US protectionism against China.

The US Department of Commerce on June 26 opened a probe into whether China has dumped or subsidized wire decking sold in the US market, following the launch of similar investigations into wire strand and steel grating on June 17 and 19.

The Ministry of Commerce posted a strongly worded statement on its website on Monday rejecting the decision and expressed its concerns on the protectionism trend.

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"China is shocked at the frequency of the cases and the strength of the targeting," it said in the statement. "The Chinese industry is extremely dissatisfied and the government deeply concerned."

The ministry said: "These actions are sending the wrong signals about trade protectionism within the United States and to the international community."

Fu Donghui, a lawyer with the Beijing-based Albright Law Office, said the US government and industries are showing an inclination of rising trade protectionism since the financial crisis expanded to more industries.

"During the economic downturn, the industries usually push the government to adopt remedial measures," he said.

He added that if the US government decides to levy punitive duties on certain steel imports from China after the investigations, it would be a big blow to exporters, who are already faced with dwindling orders.

Ye Yu, a researcher with Shanghai Institute for International Studies, said protectionism has been on the rise because the economic downturn has hit the real economy. Steel and automobile sectors have become the new victims of protectionism, he said.

Officials and experts agree that the World Trade Organization (WTO) rules are a vital measure to prevent protectionism from further expanding.

Ye said WTO rules are the bottom line that all members of the global trade body have agreed to and are still valid.

"The existing WTO trade system is an effective way to prevent protectionism from increasing," Fu said.

He suggested that the Chinese government should hold more high-profile talks and negotiations with the US and other governments to eliminate protectionism.

In response to the latest three anti-dumping and countervailing investigations of the US, the commerce ministry also said China reserves the right to turn to the WTO to settle the disputes and called on the US to exercise more restraint in applying trade remedy measures.

Besides frictions with the United States on steel products, China also has disputes with US and the European Union over restrictions on raw material exports.