The National Association of Manufacturers today commended U.S. Trade Representative Rob Portman for initiating a World Trade Organization dispute settlement case aimed at China’s discriminatory auto parts import regime.
“We are very pleased,” said NAM President John Engler. “The bringing of this case shows that the Administration’s recently-concluded ‘top to bottom review’ of China trade policy is being followed up, and enforcement action is being made a higher priority.
“China has been in the WTO long enough to become familiar with its rules, and one of the key rules is that you can’t cut tariffs and then nullify the effect by putting on a tax that, in effect, restores the trade restriction,” Engler explained. “China’s actions promote the use of locally-made parts at the expense of imported parts, a practice that U.S. manufacturers do not want spreading to other product lines.
“China has been good about living up to a lot of its WTO obligations, but it can’t pick and choose. It has to live up to all of its obligations.”
Engler noted other areas in which China has not followed through on its obligations, such as its failure to protect intellectual property adequately. “I think this auto parts case is just the first olive out of the jar, and I expect there will be more.”
Responding to some who suggest that taking China into a WTO dispute settlement is tantamount to declaring a trade war, he said, “It’s the opposite, really. When we have trade disputes, the right thing to do is to take them to the rules-based WTO for an impartial settlement. This is how trading partners can avoid nasty, bilateral slugfests, and Ambassador Portman made the right call here,” Engler concluded.
