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Obama brings new trade case against China for re-election

By Wu Chengliang: 0 Comment(s)Print E-mail People's Daily, March 16, 2012

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My turf [By Jiao Haiyang/China.org.cn]

On March 12, the Associated Press cited senior Obama administration officials as saying that the United States would bring a new trade case to the World Trade Organization on March 13 along with the European Union and Japan over China’s limits on exports of rare earth minerals.

The United States asked the WTO to facilitate talks with China over its curtailment of exports of rare earth minerals, according to the officials, who requested anonymity in order to speak ahead of the president. The move is aimed at pressuring China to lift restrictions on exports of rare earth minerals and leveling the playing field for U.S. companies. The senior administration officials said that Beijing’s export restrictions give Chinese companies a competitive advantage by providing them access to more of these rare materials at a cheaper price, while forcing U.S. companies to manage with a smaller, more costly supply. They suggest that it is an unfair trade practice against rules established by the WTO.

The U.S. economy is recovering slowly, and economic problems have become a major obstacle to Obama’s re-election bid. Obama recently lashed out at China, saying that its economic policies and “unfair trade practices” have hindered U.S. employment and economic growth as well as the development of U.S. companies. In order to win more votes, certain U.S. politicians have politicized China-U.S. trade disputes, and even threatened a trade war with China, causing great concern among far-sighted Americans.

The move appears to be part of a broader effort by Obama to toughen his stance on trade with China as he seeks re-election in November, according to a Reuters report. He used an executive order last month to create a new inter-agency trade enforcement unit, which is expected to be up and running in the coming months, with China as its primary target.

The Wall Street Journal said in a commentary that the case can be seen as part of the Obama administration’s stepped-up enforcement of trade rules and business practices in China. During his meeting with visiting Chinese Vice President Xi Jinping, Obama said that the United States welcomes China’s economic growth, but China needs to adhere to international economic and business standards.

According to the Associated Press, China has 10 days to respond, and must hold talks with the United States, European Union, and Japan within 60 days under the terms of the WTO complaint. If an agreement cannot be reached within that time frame, the United States and its partners could request a formal WTO panel to investigate Chinese practices.