China files WTO complaint on US tire tariffs

14 Sep 2009, 1907 hrs IST, AGENCIES

BEIJING: Beijing filed a World Trade Organization complaint Monday over new US tariffs on Chinese tires, stepping up pressure on Washington in the latest in a series of trade disputes.

The conflict is a potential irritant as Washington and Beijing prepare for a summit of the Group of 20 leading economies in Pittsburgh on Sept. 24-25 to discuss efforts to end the worst global downturn since the 1930s.

The Chinese complaint to the WTO in Geneva triggers a 60-day WTO process in which the two sides are to try to resolve the dispute through negotiations. If that fails, China can request a WTO panel to investigate and rule on the case.

"China believes that the above-mentioned measure by the US, which runs counter to relevant WTO rules, is a wrong practice abusing trade remedies," said a Chinese government statement quoted by the official Xinhua News Agency.

Beijing's unusually prompt response to Friday's tariff decision shows the urgency China attaches to maintaining exports amid slumping global demand.

President Barack Obama approved the higher duties to slow the rapid growth of US imports of Chinese-made tires blamed for the loss of thousands of American jobs. Beijing criticized the move as a violation of free trade and called on other governments to oppose protectionism.

The United States and China, the world's largest and third-largest economies, have been embroiled in disputes over access to each others' markets for goods including steel pipe, auto parts, poultry, movies and music.

The White House said Obama acted under a provision in the US-Chinese agreement on Beijing's accession to the WTO that allows Washington to slow the rise of Chinese imports to give time to American industry to adjust.

Obama's order raised tariffs for three years on Chinese tires — by 35 percent in the first year, 30 percent in the second and 25 percent in the third.

The United Steelworkers brought the case in April and said more than 5,000 tire workers have lost jobs since 2004 as Chinese tires flooded the US market.

On Sunday, Beijing announced it would investigate complaints that American auto and chicken products are being dumped in China or benefit from subsidies. The ministry said the US imports have "dealt a blow to domestic industries."

Last month, Beijing was forced to change its tariffs on imported auto parts after losing an appeal of a WTO ruling in a case brought by the United States, the European Union and Canada. They challenged Beijing's policy of requiring automakers to use at last 40 percent Chinese-made components or pay more than double the usual tariff on imported parts.