Jakarta, CNBC Indonesia – China won against the United States (US) in the World Trade Organization (WTO). The UN agency allowed China to impose duties on US imports worth US$ 645 million or around Rp. 9.2 trillion (assuming Rp. 14,300/US$) per year.
“In view of the arguments and evidence of the parties in this process, we have determined that the appropriate rate… is US$ 645.12 million per year,” said a WTO arbitrator’s decision, Wednesday (26/1/2022), quoted from AFP.
The US, which could not appeal the decision, said it was very disappointed. Uncle Sam said it reinforces the need to reform WTO rules by saying the rules “protect” China.
“Today’s deeply disappointing decision by a WTO arbitrator reflects the wrong interpretation of the ‘Board of Appeals’, which undermines the ability of WTO members to defend our workers and businesses against subsidies that distort China’s trade,” said U.S. Trade Representative Katherine Tai spokesman Adam Hodge.
“Today’s decision reinforces the need to reform WTO rules and dispute resolution, which have been used to protect China’s non-market economic practices and undermine fair and market-oriented competition.”
But the WTO’s green light does not mean China will automatically impose tariffs, in whole or in part, on US imports. The figure was revealed in an 87-page decision by a WTO arbitrator on the level of retaliation Beijing could seek in its dispute with Washington over counter-tariffs (countervailing duty/CVD) US on certain Chinese products.
The dispute dates back to 2012, prompting the WTO to form a panel of experts to resolve China’s grievances to the United States. State President Joe Biden himself authorized additional tariffs for Chinese products, ranging from paper to tires and solar panels.
The WTO’s Dispute Settlement Body ruled in China’s favor and the decision was upheld by its appeals judge in 2014. This paved the way for China to retaliate against the US.
Beijing initially asked to be allowed to impose tariffs on $2.4 billion worth of U.S. products annually but later reduced its demand to $788.75 million. While the US argues that duties should not exceed US$106 million per year.
In a separate case in November 2019, a WTO arbitrator allowed China to impose duties on up to $3.6 billion worth of U.S. imports. So far, China has not notified the WTO that it has applied the agreed retaliatory tariffs from the case.
Washington itself has long complained about the WTO dispute settlement system, especially its appeals court, because it is claimed to be unfair. Biden’s predecessor, Donald Trump, suspended the system in December 2019 by blocking the appointment of new judges to the Appeals Chamber.
(tfa/tfa)
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