China defends export limits, highlights its own trade complaint

Jun.25 MetalBiz--China's government said it will contest complaints to the World Trade Organization from EU and US that the nation unfairly limits exports of raw materials such as magnesium, coke and zinc.

The policy aims to protect the environment and natural resources and "is in accordance with WTO rules," the Ministry of Commerce stated on June 25.

The EU and US, which on June 24 lodged their third joint complaint against China, allege that the nation's export taxes keep material costs lower for domestic steel and manufacturing companies. On June 25, China called for a WTO probe of US restrictions on poultry imports and the trade body's former chief, Mike Moore, warned that the world is in "dangerous waters" as protectionism increases.

"It's a gradual slide towards greater trade protectionism," said Ben Simpfendorfer, an economist with Royal Bank of Scotland in Hong Kong.

The raw-materials case is the first WTO complaint brought by the Obama administration, which came to office vowing to take a harder line against trade barriers, especially in China.

"China's policies on these raw materials put a giant thumb on the scale in favor of Chinese producers," U.S. Trade Representative Ron Kirktold reporters in Washington on June 24. "It's our job to make sure we remove that thumb."