BEIJING, July 1 (Xinhua) -- The United States and the European Union have recently imposed importation barriers upon three kinds of Chinese products, all using antidumping as an excuse.

The moves came on the heels of the Toronto summit of the Group of 20 leading economies late last month, where the U.S. and EU leaders explicitly pledged to fight various forms of protectionism.

Yet with their call for free trade still lingering in the air, the U.S. and EU policymakers backtracked, throwing themselves into a scenario that harms not only China's interests but also their own.

On Monday, the U.S. Commerce Department set final antidumping duties on imports of woven electric blankets from China. On Wednesday, the U.S. International Trade Commission decided in a final move to slap punitive antidumping tariffs against a Chinese-made chemical product, while Brussels announced to start an antidumping probe into wireless modems imported from China.

In just three days, Chinese products fell victim to three antidumping-related cases. Although protectionist measures against the Chinese imports are not rare in the wake of the global financial crisis, the frequency these days is startlingly high.

Meanwhile, in all the three cases, both Washington and Brussels have used antidumping as a lame excuse to put up new protectionist barriers.

Dumping literally means that producers in one country flood another country with products sold at a price lower than its fair value and eventually cause damage to local producers.

In the face of this definition, no U.S. or EU accusation of dumping against China would possibly hold.

But the tricky part of antidumping cases against the Chinese imports is that the fair value of a Chinese-made product is not decided based on the the product's prices in the Chinese market, but is cooked up by Washington and Brussels using a flaw in the current World Trade Organization (WTO) rules.

Both Washington and Brussels choose not to designate China as a market economy and claim that prices in China are somehow controlled by the government, so they will use the market prices in a "comparable third country" to decide the fair value of the Chinese imports.

Every time they choose a third country which they consider as a market economy, they can easily make sure that prices in that country are considerably higher than in China, and thus they can comfortably put the dumping label upon the Chinese producers.

The actual value of goods involved in the latest three antidumping cases against the Chinese imports is relatively small, but the punitive tariffs would hurt the Chinese producers and workers anyway.

More importantly, in so doing, Washington and Brussels could send out a wrong signal to other uncompetitive domestic producers: if they cannot compete with the Chinese producers, all they need to do is to request an antidumping probe, and then the authorities will shut the Chinese imports out of the local market.

Furthermore, the real costs of those trumped-up antidumping cases are not paid by the Chinese producers alone. The U.S. and EU importers, retailers and ultimately consumers will feel the pinch too.

Especially for the consumers, when less expensive Chinese products are driven out by the imposition of punitive tariffs, they have to pay a higher price for a domestically made similar product.

At the moment, although the world economy is slowly recovering, it still faces many risks on the road to a sustainable growth, and protectionism is one of the biggest.

World leaders should bear it in mind that when it comes to resisting protectionist impulses, it should be more about deeds than words.

Editor: Xiong Tong

English.news.cn   2010-07-01 18:48:34

by Ming Jinwei

Source: news.xinhuanet.com