Potential rise in trade protection petitions cited
A group of U.S. trade association representatives warned of a potential wave of trade protection requests if the Obama administration agrees to impose hefty tariffs on imports of Chinese-made tires.
When China joined the World Trade Organization, the country agreed to allow WTO members to impose duties or quotas to prevent or remedy 'market disruptions' caused by increased Chinese imports. WTO members retain this right through Dec. 11, 2013. In the United States, these China-specific import restrictions are known as Section 421 safeguards.
'If the administration grants relief in the tire case, it will invite many more 421 petitions from companies who stand to benefit from gaining market protection from Chinese competition,' said Lewis E. Leibowitz, counsel to the Consuming Industries Trade Action Coalition, at the panel discussion in Washington on Thursday.
'This would create an island of high input prices in the U.S. that would directly threaten the U.S. consuming industries, which rely on access to globally priced inputs to compete internationally,' he said.
The panel was sponsored by the Consumer Industries Trade Action Coalition, Retail Industry Leaders Association, U.S. Association of Importers of Textiles and Apparel, and U.S.-China Business Council.
'The Obama administration faces a very difficult decision on the Section 421 tires case,' said Tim Keeler, who represents GITI Tire (USA) Ltd. and GITI Tire (China) Ltd. 'While tire workers are hurting, it is a result of the economy overall, and the auto industry specifically, and not tires from China.'
Keeler said it's especially in this global economic downturn for the United States and China to work cooperatively to rejuvenate their economies. 'The administration will need to use all of the creativity that it has to fashion a remedy and assistance that actually helps workers in the U.S. tire industry without hurting other U.S. workers,' he said.
The White House is expected to make its decision on whether to impose increased tariffs on Chinese tire imports soon.
Potential rise in trade protection petitions cited
