China enters peak period of trade disputes
(Xinhua)
Updated: 2004-10-26 09:30

With the fast growth of China's foreign trade after the WTO accession, China has entered a peak period of trade disputes with foreign countries, said officials with the Chinese Ministry of Commerce.

Vice Minister of Commerce Yu Guangzhou said at the on-going 96th China Export Commodities Fair that China's surging exports in recent years have been accompanied by more and more international trade disputes over Chinese products.

According to Yu, China's export trade has maintained an annual growth rate of more than 30 percent since China entered the World Trade Organization (WTO). In the first three quarters of this year, China's exports jumped 35.3 percent year-on-year, topping US$400 billion.

Experts said China's fast economic growth and rising status in international trade put pressure on many foreign competitors. As a result more and more foreign companies are asking their governments to put limits on Chinese products.

China's color TV industry is a good example. On May 14, the US International Trade Commission said that Chinese businesses were dumping their TVs on the US market. US authorities are now collecting a high anti-dumping tax on China's TV exports totaling 486 million dollars.

Liu Meikun, deputy director of the China Chamber of Commerce for Import and Export of Machinery and Electronic Products, said at the fair that the move brought great losses to China's TV industry. The tax means that China may lose the United States' market because of high exporting costs, leaving about 35 million TVs of production capacity unused.

Currently, many Chinese products increased their exports due an increase in quantity. This was especially obvious in the textile industry. Wang Shouwen, director of the ministry's department of fair trade said that this is one major reason for increasing trade disputes.

According to Wang, the low-value-added textile industry in China can only make profits by exporting large quantities of products. As the exports quota for textile products will be canceled from January 1, 2005 worldwide, China's textile industry will face more exporting opportunities than ever. This means, though, that different kinds of trade barriers will follow.

On Oct. 12 this year, the trade representative of the European Union announced that the EU will stop general system of preference (GSP) treatment for Chinese textile products and garments because of Chinese products are now competitive in the European market.

The US textile and clothes producers announced the same day that they will launch special safeguard measures against some Chinese products.

Ministry officials said as China still faces problems of improper management in the exports market, some Chinese companies use improper means to expand exports.

According to the ministry, in the first half this year, the imported China-made penicillin has accounted for about 60 percent of the Indian market.

But as some Chinese companies tried to further expand its market share and sold the products at a very low price. Because of this, India launched safeguard measures against the Chinese penicillin beginning in July.

Statistics from the Ministry of Commerce show that currently, one out of every seven anti-dumping measures is against a Chinese product. The year 2005 will see the peak of anti-dumping cases against Chinese products.

Wang said for a long time to come, Chinese exported products may face more trade disputes including anti-dumping, anti-subsidy, protection measure, special safeguard measures and green trade barriers.

He urged the Chinese companies to watch closely the moves of foreign countries and regions, and understand the latest information on trade barriers, so as to reduce the risks of trade disputes.

According to Wang, the Chinese Ministry of Commerce has just opened an Internet website for trade information. China is also working to establish a mechanism to help enterprises affected by anti-dumping and special safeguard measures.

In addition, experts urged Chinese companies to strengthen self-control in exports and try to keep China's exports market in sound order.

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