CHINA / FILE: China says it will slap anti-subsidy duties on imported American cars

Record ID: 511349

  • Title: CHINA / FILE: China says it will slap anti-subsidy duties on imported American cars
  • Date: 15th December 2011
  • Summary: SHANGHAI, CHINA (FILE - APRIL 2011) (REUTERS) VARIOUS OF PEOPLE AT SHANGHAI AUTO SHOW FORD LOGO ON CAR FORD STEERING WHEEL IN CAR VARIOUS OF PEOPLE AT SHANGHAI AUTO SHOW VARIOUS OF FRONT OF FORD FOCUS
  • Embargoed: 30th December 2011 12:00
  • Keywords:
  • Location: China
  • Country: China
  • Topics: Business,International Relations,Industry,Transport
  • Reuters ID: LVAEQA7FA1OW3BUJEAEPWSQYNO1F
  • Story Text: China's Ministry of Commerce said on Wednesday (December 14) it would impose anti-subsidy and anti-dumping duties on imported cars made in the United States.
    The announcement is the latest in a series of trade spats between the world's two largest economies.
    The duties, which will take effect from Thursday (December 15) for two years, will affect major U.S. auto makers Ford Motor Company, General Motors, Chrysler Group, and U.S.-based foreign automakers.
    Cars that have an engine capacity at or above 2.5 litres will be hit with duties, a statement said.
    The cost of the duties will range from 2.0 percent to 21.5 percent.
    The ministry's statement said U.S. cars and sport utility vehicles benefited from subsidies and had been dumped into the China market, causing "substantial damage to China's domestic industry".
    Some analysts said Wednesday's announcement exemplifies the trade tensions brewing between the two countries.
    "There are trade tensions between U.S. and China. This is just one further example of how they could be demonstrated and the kind of action that you could see taken. The auto industry too, don't forget, very, very sensitive one for China. It employs a lot of people, got a major boost from the stimulus package from 2008, that stimulus is being wound back. The auto industry in China is suffering. China just finished its central economic work conference, most important economic planning meeting, the auto industry's high on its agenda. This is a significant step." said Chief Economics Correspondent of Thomson Reuters's Greater China Bureau, Nick Edwards.
    Ten years after China joined the World Trade Organization, experts say it is likely to become more deeply involved in trade disputes. The United States has filed 12 trade cases against China since it joined the WTO, five since U.S. President Barack Obama took office.
    However, Edwards said it is premature to call the latest dispute a trade war.
    "Lots of analysts have been anticipating a trade war of sorts. They have looked at what's happened with currencies - they expect it to get into the real economy, real businesses. It's probably early days to be calling this a trade war based on this one case, but lots of trade lawyers are anticipating an escalation in the number of suits that are brought. They are expecting an awful lot more of this tit-for-tat kind of trade dispute sense." he said.
    U.S.-China trade tensions have been mounting in recent months, particularly in the solar industry.
    China's Commerce Minister Chen Deming said in November the country is likely to fight back if other countries resort to trade protectionism.
    Last month China announced an investigation into U.S. government policy and subsidy support for renewable energy.
    The move to impose tariffs on imported U.S. cars came weeks after the United States decided to probe sales of Chinese-made solar panels.
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