MOC: China to Face Increasing Trade Friction

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Apr. 12 – According to a press conference held by China’s Ministry of Commerce (MOC) on April 8, trade probes targeting China are becoming more frequent and complicated, and resolving trade friction will be a long-term and challenging task for the country.

Last year, 21 countries initiated 77 trade remedy probes (up 11.6 percent y-0-y) against China, involving US$27.7 billion in total (up 369 percent y-o-y). Furthermore, in the first quarter of this year, 12 countries have already launched 22 investigations relating to trade remedy measures against China, involving US$963.7 million in total.

From 2002 to 2012, China was hit by 842 foreign trade remedy cases, including 621 anti-dumping cases, 61 anti-countervailing cases, 124 safeguard measure cases, and 36  special safeguard measure cases. The amount of money involved has totaled US$73.6 billion. In addition, there have been 130 “Section 337 investigations” launched by the U.S. International Trade Commission, which are mainly related to claims over intellectual property rights.

“Increasing trade friction is an accompanying phenomenon as China has become the world’s second largest economic entity and a big trade country,” said Song Heping, an investigator at the Bureau of Fair Trade for Imports and Exports of the MOC. “The outlook for trade-remedy investigations targeting China is not optimistic as increased trade friction will likely become more normal, and exporters are facing a very complex trade environment.”

The MOC said that the escalating trade friction can be attributed to the growing trade protectionism following the Global Financial Crisis and the overreliance of Chinese enterprises in several foreign markets. China’s exports have maintained a relatively fast rate of growth amid sluggish global demand, making the country an easy target for trade protectionism moves.

Meanwhile, the rapid rise in disputes with emerging-market economies has posed a threat to China’s economy. Last year, these countries launched 54 trade remedy probes against China, making up 70.1 percent of the total. In response, China intends to step up efforts to boost imports from these emerging markets to prevent new pressure from such regions.

The MOC also asked China’s trade partners to be more restrained and cautious in taking trade remedy measures.

“We are willing to improve negotiations and communications with related countries to solve trade issues in a constructive way,” said MOC Spokesman Yao Jian.

In 2013, China will continue to promote trade and investment liberalization and, at the same time, will look to deepen domestic reforms to enhance the competitiveness of China’s export enterprises and products, thereby promoting the balanced development of the country’s import and export trade.

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