World Trade Organisation Final Trial Maintains Sino-US Tire Dispute

International Online Report: The World Trade Organisation Appellate Body issued a ruling on the Sino-U.S. tire trade dispute case in Geneva on the 5th. It was determined that the United States imposed punitive tariffs on Chinese-origin tires in line with WTO rules. The Chinese delegation to the WTO issued a statement on the same day expressing its regret over the result of this ruling. He believed that this move of the United States distort international trade and was intended to pass on domestic political pressure. Details: This site is connected to Duan Xiujie, a Swiss journalist of China Radio International Global Broadcasting Co., Ltd.:

Moderator: First of all, let us briefly introduce the context of China-US tire trade disputes.

Reporter: Okay. The China Tire Special Security Case was regarded as the first case of Sino-US trade friction in the Obama era. In early 2009, the U.S. Steel Workers Union sued the U.S. International Trade Commission for the dumping of tires in the U.S. market in previous years, resulting in the closure of U.S.-related industries and unemployment of workers. In June of that year, the U.S. International Trade Commission proposed to export to China. The passenger and light truck tires in the United States have imposed special ad valorem tariffs of 55%, 45%, and 35% for three consecutive years. In September, the proposal was approved by President Obama. The final punitive tariff rate is 35% in the first year, 30% in the second year, and 25% in the third year.

Regarding the United States’ determination to adopt unilateral special safeguard measures despite China’s opposition, China appealed to the World Trade Organization. In December 2010, the WTO Dispute Settlement Mechanism announced the report of the expert group and believed that there is no conflict between US practices and WTO rules. For this conclusion, the Chinese side expressed its dissatisfaction and appealed to the WTO Appellate Body in June this year to request the review of the report of the expert group. On September 5, the Appellate Body released a 123-page ruling report, the core content of which is still to support the conclusion of the Group of Experts. It believes that the special protection measures taken by the United States against Chinese tyres imported into the United States are in line with WTO rules, and it is believed that Chinese tyres do indeed affect the United States. The related industry caused damage. The WTO Appellate Body is the highest authority of the WTO dispute settlement mechanism and its ruling has legal effect.

Moderator: Okay. So why is China's tire protection case causing external attention? Does China's import of American tires pose a threat to the employment of American workers?

Reporter: The case of China's tire special protection case with a value of US$1.7 billion has attracted widespread attention since the outbreak, not only because it was Obama's first trade remedy against China after being in power, but also because of its many unconventional production disputes. . First, the lawsuit was initiated by the union-style American Steel Workers Union, not by the Chinese tire company, the US tire company. On the contrary, many tire companies in the United States, especially some small and medium sized tire wholesalers, oppose this lawsuit. The United States Tire Industry Association, which represents the interests of various sectors in the US tire industry in terms of production, sales, maintenance, and recycling, has disclosed to Obama an open letter to the United States. The Tire Special Security Case will have four major adverse consequences for the United States: First, it will not protect the U.S. manufacturing industry. Jobs; Second, will cause tire prices to rise, US consumers face fewer choices; Third, will lead to chaos in the US tire market; Fourth, US consumers may delay necessary due to the inability to purchase affordable tires. Tire replacement behavior, which poses a potential danger to road safety in the United States.

It should be said that the employees of American tire companies are very clear: Chinese tires are a blank for making up for low-end tires in the US market and have not directly impacted the tire industry.

Well, in the opposition of the industry, the United States still insists on sanctions against Chinese tire exports to the United States, and its purpose seems to have no meaning. The statement issued by the Chinese delegation to the WTO on the 5th clearly stated that the purpose of this distortion of international trade practices in the United States was intended to shift domestic political pressure. According to the statement, the number of tires that China exported to the United States has decreased during the more than one year that the United States imposed sanctions on Chinese exports to the United States, but the total amount of tires imported from the United States has continued to rise. In 2010, the United States imported tires from China decreased by 23.6% from 2009, and further decreased by 6% in the first half of 2011. However, the total number of tires imported by the United States in 2010 increased by 20.2% from 2009, and increased by 9% in the first half of 2011. These data are sufficient to show that the previous Chinese tire shipments to the United States did not threaten U.S.-related companies, but the U.S. special protection measures have seriously damaged the interests of Chinese companies. The statement made by the Chinese delegation to the WTO requires the United States to immediately correct this practice and provide Chinese companies with a fair market environment.