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More trade cases against China likely, experts say

By Lu Chang and Zhang Jin (China Daily)
Updated: 2010-10-29 11:06

BEIJING - The United States may launch more trade cases against Chinese imports - even after the US Congressional elections - in a sign of persisting trade frictions as Washington aggressively boosts its exports, Beijing-based experts said.

They made the predictions after the US, which aims to double its exports in five years, initiated 24 trade remedy cases against a number of Chinese products - such as solar power lamps, liquid crystal displays and printer ink cartridges - from Oct 1 to 15.

"The unusually high number of trade cases within such a short period showed that the US is resorting to trade protectionism to curb Chinese imports after it failed to press China to rapidly appreciate the renminbi," said Zhang Bin, associate researcher at the Institute of World Economics and Politics of the Chinese Academy of Social Sciences.

The yuan climbed above 2 percent since the Chinese government severed it from the US dollar in June. Some US lawmakers have said the Chinese currency should appreciate as much as 40 percent to give US exports an equal footing.

In the first nine months of the year, China ran a trade surplus of $132.5 billion against the US on a two-way trade of $278.5 billion, Chinese Customs figures showed.

The failure to push up the yuan, coupled with the upcoming midterm Congressional elections and high jobless rate, prompted the Obama administration to curb Chinese imports recently, said Zhou Shijian, a senior economist at the Center for China-US Relations.

Republicans are now believed to make gains at the elections, with a possible takeover of at least the House of Representatives. US people have been complaining about an unemployment rate of 10 percent.

These have forced the ruling Democrats to step up efforts to garner more support from voters.

"Launching trade cases at this time is aimed at winning the hearts of many labor unions, workers and industries," Zhou said.

"Trade frictions between China and the US have come to a periodic high."

But most Chinese experts interviewed by China Daily don't believe trade tensions will abate after the elections.

"A look at the overall Sino-US trade picture will show us that more trade frictions are likely to pop up," said Xiao Lian, director of the US Economics Center of the Chinese Academy of Social Sciences.

He said China, as the world's largest exporter and supplier of labor-intensive products, will fall victim to surging protectionism globally.

Last year, 40 percent of anti-dumping charges, 75 percent of anti-subsidy cases and 43 percent of trade investigation cases launched by World Trade Organization members were against China.

Among China's major trading partners, the US, which is aggressively promoting its exports, is most likely to confront China on the global market, Xiao said.

Early this year, US President Barack Obama aimed to double US exports and create 2 million American jobs in five years.

Last year, the US launched 23 trade cases against China, up 53 percent year-on-year.

However, experts said a trade war is unlikely because both countries know it will be in no one's best interest.

The US is China's largest exporting destination while the US is China's fourth largest import source.

Hu Haiyan contributed to this story.