Executive Briefings

China Protects Its Manufacturers with Unfair Export Limits on Certain Raw Materials, WTO Says

The World Trade Organization has ruled that China unfairly limited exports of nine raw materials to protect domestic manufacturers. A WTO appeals body rejected China's appeal of a ruling in July that concluded the Asian economic powerhouse had violated international trade rules. The appeals body largely sided with the United States, Europe and Mexico, which had taken issue with Chinese restrictions on its exports of nine materials used widely in the steel, aluminum and chemical industries.

They had complained that China drives up prices on overseas shipments of the materials by setting export duties, quotas and licensing requirements on them, giving the country's manufacturers an unfair edge over competitors. But China had argued that its export limits were needed to protect the environment.

The ruling affects China's exports of certain forms of bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, yellow phosphorous and zinc. In it, the WTO appeals body says China must now "bring its export duty and export quota measures into conformity with its WTO obligations."

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The World Trade Organization has ruled that China unfairly limited exports of nine raw materials to protect domestic manufacturers. A WTO appeals body rejected China's appeal of a ruling in July that concluded the Asian economic powerhouse had violated international trade rules. The appeals body largely sided with the United States, Europe and Mexico, which had taken issue with Chinese restrictions on its exports of nine materials used widely in the steel, aluminum and chemical industries.

They had complained that China drives up prices on overseas shipments of the materials by setting export duties, quotas and licensing requirements on them, giving the country's manufacturers an unfair edge over competitors. But China had argued that its export limits were needed to protect the environment.

The ruling affects China's exports of certain forms of bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, yellow phosphorous and zinc. In it, the WTO appeals body says China must now "bring its export duty and export quota measures into conformity with its WTO obligations."

Read Full Article