Business / Economy

Protectionist forces get stronger

By LI JIABAO (China Daily) Updated: 2014-08-07 07:22

Rocky path to recovery in US and Europe prompts more investigations, ministry says

Trade investigations involving Chinese exports increased in the first half of this year, even as exports of the world's largest merchandise trader lost steam.

In the January-June period, 53 trade remedy investigations were launched against products from China in 18 foreign markets, up 20.4 percent from a year earlier. These investigations affected Chinese exports valued at $5.29 billion, up 136 percent, said the Ministry of Commerce.

During the same period, exports edged up 0.9 percent year-on-year, while imports rose 1.5 percent, the General Administration of Customs reported.

Sang Baichuan, director of the Institute of International Business at the University of International Business and Economics in Beijing, said that the value of affected exports during the period "accounted for a larger share in overall exports than the average level in the past decade, showing intensified trade friction involving Chinese products".

"China will continue to face frequent trade friction and there is no reason to be optimistic about the prospects if we look at the country's international trade environment and the resurgent protectionism in the world," Sang said.

After China became the world's largest goods trader in 2013, many countries "stepped up efforts to curb the inflow of Chinese products to narrow their trade deficits", he added.

"Meanwhile, the recovery path of the global economy is proving to be more complex than anticipated. The uncertainties surrounding the economic recoveries in the United States and the European Union, together with concerns over employment prospects, suggest high risks of trade remedy measures against Chinese exports to protect local employment," Sang said.

In the first half of this year, India launched the most trade remedy measures against Chinese exports. Trade investigations from the US, China's second-largest trading partner, led to the largest loss of China's exports in the same period, followed by Russia, the 21st Century Business Herald reported on Wednesday.

The US Commerce Department decided on July 25 to extend punitive duties on Chinese solar products. The department imposed anti-dumping duties as high as 165.05 percent on solar panels and cells from the Chinese mainland, on top of countervailing duties set a month earlier. Producers from Taiwan also faced anti-dumping duties of up to 44.18 percent.

China's Commerce Ministry urged the US to "prudently handle the investigation ... and create a good environment for competition in the global solar industry".

Zheng Yuesheng, spokesman for the General Administration of Customs, said in a recent news conference that global protectionism "has been increasing this year and the intensified trade friction constrained the expansion of China's exports" in the first half of this year.

Sang said that emerging economies are growing into a new force in initiating trade remedy measures against Chinese products.

"China's trade with emerging economies grew faster than the country's overall trade in recent years. Despite complementary economic structures between China and the emerging economies, competition remains prominent in different industries," Sang said.

Although the absolute value of exports endangered by trade friction accounted for a very small share of China's overall shipments, the impact is "great as the measures disrupt the level playing trade environment and hinder trade liberalization", he added.

In 2013, 92 trade remedy investigations were launched into Chinese products, affecting exports valued at $3.66 billion, according to the ministry.

China's exports totaled $2.21 trillion last year, up 7.9 percent year-on-year, according to the customs administration.

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