Trade Group Supports U.S. Government’s Stance Against Granting China Market Economy Status

Trade Group Supports U.S. Government’s Stance Against Granting China Market Economy Status

The Manufacturers for Trade Enforcement (MTE) voiced its support late last week for United States trade representatives’ contention that the People’s Republic of China continues to operate a non-market economy, in large part due to Beijing’s manipulation of the domestic aluminium industry.

“There is little doubt that China’s market reforms have fallen short of the expectations that were held by many members when China joined the WTO,” said U.S. trade diplomat Chris Wilson at a WTO meeting July 13 and quoted in a Reuters piece published at the time. “This is particularly evident in the steel and aluminum industries where China’s pervasive interventions have led to a significant overcapacity of global supply that is threatening the viability of competitive firms in these industries around the world.”

According to the press release, several United States trade officials indicated that China will not be granted market economy status (MES) later in the year. Although Chinese officials hold that their country should be granted MES automatically after having been a member of the WTO for fifteen years, U.S. trade officials countered by pointing out that the determination of MES recognition in each country is based upon that particular country’s domestic laws.

“We’re pleased to see that the U.S. government is taking a principled stand on this issue,” said President and CEO of the Aluminum Association and co-chairman of the Manufacturers for Trade Enforcement Heidi Brock. “Under U.S. law, the Commerce Department is empowered to make a market economy status determination under established criteria, which, based on the experience of our industries, China has not met.”

“China maintains state control over many critical aspects of its economy, including key strategic industries like steel,” explained the President and CEO of the American Iron and Steel Institute and co-chairman of the Manufacturers for Trade Enforcement Thomas J. Gibson.  “It is clear that China has not met criteria to be designated a market economy.  Prematurely granting China market economy status would completely undermine the effectiveness of our trade laws.”

MTE is a coalition that represents over one million workers in the aluminium, steel, chemical, textile, and other manufacturing industries. According to the press release, members of the coalition unanimously oppose the U.S. recognizing China as a MES.