Beijing Says U.S. Aluminium Alloy Sheet Investigation Risks Trade War

Beijing Says U.S. Aluminium Alloy Sheet Investigation Risks Trade War

Less than a week after the announcement of an investigation into allegations of dumping by the United States government, the People’s Republic of China shot back a verbal retort, accusing the U.S. government of impeding fair trade by its actions.

In a commentary piece published Monday in the state-run Xinhua News Agency, Beijing opined that the self-initiated investigation regarding common aluminium alloy sheet was unusual in the extreme and possibly injurious to an otherwise healthy and voluminous trade relationship between the two economic heavyweights.

The Commerce Department initiated the investigation of common alloy sheet from China, which was a US$603.6-million enterprise last year, based upon evidence it says it has that the sheet is being sold at below-market values thanks to countervailing subsidies from the state. In addition, the Department says that evidence has emerged that such practices have done material harm to the domestic producers of such products.

Though it noted President Trump’s commitment to fair trade, the commentary declares this investigation to be an act in stark opposition to promoting it.

“However, the U.S. government is going in the opposite way. It should have used the dispute settlement mechanism under the World Trade Organization (WTO). Instead, it opted for a unilateral approach, taking on the dual roles of the plaintiff and the arbiter, which might lead to a lack of impartiality in the investigations.”

Beijing goes on to imply that the move was little more than an act of appeasement to a small faction of radicals. However, they warn that such a move may provoke dire consequences.

“The recent move is not reasonable from an economic and trade perspective, but makes sense in the political scale since U.S. domestic politicians and lobby groups might be happy to see the Trump administration’s hard line on trade with China.

“Such moves will undermine mutual trust and trigger retaliation, allowing no party to emerge unscathed.”

Beijing continued by pointing out the robust trade the countries have engaged in over the years, noting that bilateral trade between the pair has ballooned from US$2.5 billion three decades ago to US$524.3 billion today.

The commentary closed by urging mutual understanding, saying that continued negotiation is the best way to prevent an impending trade war.

“Getting tough on China is a bipartisan stance held by a handful of U.S. politicians, and hardliners on trade with China typically win congressional support. However, U.S. politicians should meet China halfway to support healthy and stable trade ties for the benefit of their people.”