WTO says China can place duties of $645m on US imports

The World Trade Organization's ruling that authorizes China to impose $645 million of compensatory tariffs against the United States is a victory for multilateralism and free trade, and highlights the failure of the US to abide by WTO rules that it's obliged to follow, experts and business leaders said on Thursday.

Their comments came after the trade body decided on Wednesday to allow China to impose the tariffs. This followed China's challenge at the Geneva-based organization in 2012 against countervailing duty investigations by the US that led to the imposition of anti-subsidy duties from 2008 to 2012 on 22 Chinese products ranging from solar panels to steel wire.

China also challenged the US claim that majority government ownership is sufficient to treat an enterprise as a "public body".

"The ruling was of great significance to rebut the illicit countervailing practices of the US, protect the legitimate trade interests of Chinese enterprises and safeguard the multilateral trading system," the Ministry of Commerce said in an online statement.

The US must stop looking for any excuses and take immediate action to correct its wrongdoing in the trade remedy investigations against China, the statement said.

Analysts said the ruling has again sent a clear message that the US violated WTO trade rules. The decision also boosts global confidence in the multilateral trading system's authority, they added.

"The ruling is important to correct wrong practices in global trade by some countries. It is expected to serve as a measure to punish unilateral and hegemonistic behavior," said Huo Jianguo, vice-chairman of the China Society for World Trade Organization Studies.

Xia Aimin, CEO of Tianjin Shangdian Qinding Energy Technology Co, who previously worked for a company that went bankrupt after the imposition of US anti-subsidy tariffs, said the ruling was an example of "belated, but welcome justice".

Chinese solar panel products continue to be very popular on global markets thanks to their high level of quality and competitive prices, he said. Due to their experiences in recent trade disputes, Chinese companies are now better prepared to do business in global markets, Xia added.

Lin Shen, a researcher at the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, said the best way to conduct free trade, as the US always claims it wants to, is to observe the rules of the WTO.

It is groundless for some countries to negate China's status as being a developing country and make wrongful allegations about China's economic model, including criticisms of Chinese State-owned enterprises' ways of doing business, which abide by market rules, he added.

In November 2019, the WTO granted China the right to impose retaliatory tariffs of $3.58 billion on US goods after finding fault with some US anti-dumping measures against China.

In 2018 and 2019, the US also imposed additional tariffs on Chinese imports, but a WTO panel ruled in 2020 that the US was in breach of its WTO obligations.