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U.S. to Investigate China Clean-Energy Subsidies (Update3)
2010-10-15 21:40:59.554 GMT
(Updates with comment from Chinese official in ninth
paragraph.)
By Mark Drajem
Oct. 15 (Bloomberg) -- The U.S. agreed to investigate
China's aid to its clean-energy producers, acting on a complaint
from the United Steelworkers union that says the assistance
violates global trade rules.
Accepting the petition may lead the Obama administration to
file a protest at the World Trade Organization over subsidies
that the union says are contrary to trade rules.
"Green technology will be an engine for the jobs of the
future, and this administration is committed to ensuring a level
playing field," U.S. Trade Representative Ron Kirk said today
in a statement in announcing the decision.
The case escalates commercial strains between the U.S. and
China, its second-largest trading partner. Trade tensions grew
as President Barack Obama criticized China's currency policy and
the House of Representatives passed legislation targeting
imports from China as a way to prod its leaders into raising the
value of the yuan.
The union's complaint, called a Section 301 filing, is the
first filed and accepted by Obama's administration after his
predecessor, Republican George W. Bush, turned down trade
complaints against China.
Lawmakers such as Democratic House Speaker Nancy Pelosi of
California and House Ways and Means Committee Chairman Sander
Levin, a Michigan Democrat, praised the U.S. plan to review the
subsidies.
Sends Message
"By accepting the petition the Steelworkers filed against
China's predatory and protectionist policies, it sends the
message that America is not going to stand by while our jobs get
outsourced," union President Leo Gerard said in a statement.
China and the U.S. have pushed development of wind, solar
and clean-energy technologies, offering tax breaks and
government aid to spur projects. That aid doesn't violate WTO
rules, said Wang Baodong, a spokesman for the Chinese Embassy in
Washington.
"The environment-friendly green technology policies
introduced by the Chinese government are for the purpose of
energy protection and ensuring sustainable development, which
are in conformity with WTO rules," Wang said in an e-mail.
The Steelworkers said in their filing to the trade office
last month that illegal export credits, preferences in bidding,
the forced transfer of technology and discrimination against
foreign firms give Chinese producers of renewable-energy
products an unfair advantage.
China Bank
China Development Bank, a state-owned lender, has said it
plans to lend more than $42 billion to support expansion of
solar manufacturers and wind-turbine makers.
Kirk said his office will examine and verify aspects of the
complaint. If the practices warrant it, the U.S. would file a
case at the WTO after the 90-day review, he said.
"For those allegations that are supported by sufficient
evidence and that can effectively be addressed through WTO
dispute settlement, we will vigorously pursue the enforcement of
our rights through WTO litigation," Kirk said.
In a separate decision today, the U.S. International Trade
Commission ruled that U.S. Steel Corp. and companies making
steel pipes used in oil refineries and chemical plants are being
harmed by imports from China. The decision means that duties
that could average more than 100 percent will be imposed on $182
million worth of the pipes from China.
The decision by the trade panel is the last of four that
producers such as U.S. Steel and the U.S. subsidiary of France's
Vallourec SA, the world's second-largest maker of steel tubes
for oil and gas production, needed to win to get dumping and
countervailing duties imposed on Chinese exporters.
"Without this decision, the U.S. industry would have
completely lost the U.S. market," Roger Schagrin, a lawyer at
Schagrin Associates in Washington, representing the U.S.
producers, said in an interview. Even with duties, "it's going
to be a slow recovery in demand."
For Related News and Information:
Wind Stories: NI WIND <GO>
Carbon-market events: ECAL <GO>
Top stories on regulation and business: GBIZ <GO>
A-Power's financial analysis: APWR US <Equity> CH1 Q <GO>
--Editors: Steve Geimann, Larry Liebert
To contact the reporter on this story:
Mark Drajem in Washington at +1-202-624-1964 or
mdrajem@bloomberg.net.
To contact the editor responsible for this story:
Larry Liebert at +1-202-624-1936
or lliebert@bloomberg.net.
