A complaint from the United Steelworkers union in the US about China’s clean-energy policies is “groundless” and “irresponsible,” China’s Ministry of Commerce said.
China will protect its own interests according to the World Trade Organization’s rules, the ministry said in a statement posted today on its website. The US government’s agreement to investigate the case is a “wrong” trade protectionism signal, the ministry said.
The case escalates commercial strains between the US and China, its second-largest trading partner. Trade tensions grew as President Barack Obama criticised China’s currency policy and the House of Representatives passed legislation targeting imports from China as a way to prod Chinese leaders into raising the value of the yuan.
The US acted on a complaint from the steelworkers union that the China’s aid to its clean-energy producers violates global trade rules. Accepting the petition may lead the Obama administration to file a protest at the World Trade Organization.
“Green technology will be an engine for the jobs of the future, and this administration is committed to ensuring a level playing field,” US Trade Representative Ron Kirk said yesterday, announcing the decision.
The complaint, called a Section 301 filing, is the first filed and accepted by Obama’s administration after his predecessor, Republican George W Bush, turned down trade complaints against China.
Lawmaker support
Lawmakers such as Democratic House Speaker Nancy Pelosi of California and House Ways and Means Committee Chairman Sander Levin, a Michigan Democrat, praised the US plan to review the subsidies.
“By accepting the petition the Steelworkers filed against China’s predatory and protectionist policies, it sends the message that America is not going to stand by while our jobs get outsourced,” union President Leo Gerard said in a statement.
China and the US have pushed development of wind, solar and clean-energy technologies, offering tax breaks and government aid to spur projects. That aid doesn’t violate WTO rules, Wang Baodong, a spokesman for the Chinese Embassy in Washington, said yesterday. “The environment-friendly green technology policies introduced by the Chinese government are for the purpose of energy protection and ensuring sustainable development, which are in conformity with WTO rules,” Wang said in an e-mail.
The Steelworkers said in their filing to the trade office last month that illegal export credits, preferences in bidding, the forced transfer of technology and discrimination against foreign firms give Chinese producers of renewable-energy products an unfair advantage.
China Bank
China Development Bank, a state-owned lender, has said it plans to lend more than $42 billion to support expansion of solar manufacturers and wind-turbine makers. Kirk said his office will examine and verify aspects of the complaint. If the practices warrant it, the US would file a case at the WTO after the 90-day review, he said.
“For those allegations that are supported by sufficient evidence and that can effectively be addressed through WTO dispute settlement, we will vigorously pursue the enforcement of our rights through WTO litigation,” Kirk said.
