WTO: China is taxed on 645 million USD of US goods

 WTO: China is taxed on 645 million USD of US goods

The World Trade Organization (WTO) on January 26 issued a ruling allowing China to impose import duties on US goods in a 10-year lawsuit.

In 2012, China sued the WTO over the US's imposition of anti-subsidy duties from 2008 to 2012, mainly during the tenure of former President Barack Obama, on 22 Chinese products, from solar cells to fiber steel. The decade-long lawsuit has focused on whether the United States has the right to treat large government-owned Chinese companies as government-controlled companies.

Chinese steel is one of the items subject to anti-subsidy tariffs by the US. Photo: Reuters

Chinese steel is one of the items subject to anti-subsidy tariffs by the US. Photo: Reuters

On January 26, the World Trade Organization (WTO) issued a ruling allowing China to impose a clearing tax on US$645 million worth of US goods. Adam Hodge, a spokesman for the Office of the US Trade Representative, said that the WTO had made a "deeply disappointing decision", showing a "false judgment that affects its ability to protect workers and American businesses against China's trade-distorting subsidy policies".

The US has so far said that China benefits from the WTO's easy treatment, which helps the country subsidize domestically produced goods and then sell them to the world at cheap prices. Washington asserts that the WTO's ruling shows that its rules need reform. "They have helped China maintain non-market economic policies and reduce fair competition," the US said.

Initially, China wanted the WTO to allow it to impose tariffs on $2.4 billion in US goods. This number is quite small compared to the import tax on more than 300 billion USD of goods that China imposed under former President Donald Trump.

Even so, the WTO decision remains the next symbolic victory for Beijing. In November 2019, the WTO allowed China to impose retaliatory tariffs on US$3.58 billion of US goods after concluding that Washington had made an error in deciding which Chinese goods were dumped in the US.