China opposes US tariffs on steel pipe

• Source: Global Times
• [02:58 September 11 2009]
• Comments

By Zhang Han

China's Ministry of Commerce Thursday voiced its "strong opposition" to a ruling by its US counterpart to impose preliminary duties of up to 31 percent on Chinese steel pipe, accusing the allegedly "unfair subsidies" as a miscalculation by the US.

Experts are worried that the move indicates a surge of protectionism in the United States as President Barack Obama has already been weighing a final decision for another trade dispute over Chinese tires scheduled for September 17.

"The miscalculation on the alleged subsidies has hurt the interests of Chinese companies, and China urges the US to rectify its mistakes in the final ruling," said Yao Jian, spokesman of the Ministry of Commerce, in a press release.

Following an investigation into a case appealed in April by American producers, led by the U.S. Steel Corp, the US Commerce Department claims that China-made steel pipe was backed by unfair subsidies, and decided to impose preliminary duties ranging from 10.90 percent to 30.69 percent on steel pipe used to transport oil.

The department is scheduled to carry out arbitration on December 5. After that, the International Trade Center will decide the final duties on China. It is considered to be one of the biggest to move through the US trade-litigation system in recent years.

China's Ministry of Commerce refuted the "unfair subsidies," saying that its US counterpart, regardless of information provided by China, "falsely insisted that China's steel-pipe makers were supported by a government subsidy no matter they purchase raw steel from a private company or a State-owned enterprise."

According to statements by the US Commence Department, the steel pipe to face duties will be that manufactured by Jiangsu Changbao Steel Tube Co, with a 24.33 percent tariff; Tianjin Pipe Group Corp, with 11 percent; Wuxi Seamless Pipe Co, with 25 percent, and Zhejiang Jianli Enterprise Co, with 31 percent. All other producers must pay the trade-weighted average of those figures, or 21 percent.

Wu Xiaofeng, the director of Jiangsu Changbao Steel Tube, told the Global Times that the allegation that the company receives subsidies was groundless.

"In order to get higher-quality steel, we have to pay more money to purchase it from State-owned companies rather than private companies," he said, adding that it is unfair for his company to have such a heavy duty imposed.