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Auto imports from US under scanner

By Li Fangfang and Ding Qingfen (China Daily)
Updated: 2009-10-30 08:10

China has officially kicked off anti-dumping and anti-subsidy investigations into automobile imports from the US, the nation's top trade official confirmed yesterday. The move is a significant and timely decision to show the country's clout on the global economic stage, analysts and officials said separately.

Commerce Minister Chen Deming said that his ministry was carrying out a probe on some vehicle imports from the US, based on requests from Chinese automakers.

The confirmation was made during high-level talks to resolve trade disputes between the two countries yesterday in Hangzhou.

The investigations, which were first proposed last month to challenge the Obama administration's plan to impose a 35-percent tariff on imported tires from China valued at about $1.8 billion, could lead to new duties on vehicle imports.

Chen also said the probe would be carried out in accordance with Chinese laws and World Trade Organization (WTO) rules.

He Weiwen, a member of the China Society for American Economy Studies, said the investigation was "fair and proper" and conformed to WTO regulations.

"Launching the investigation on such an occasion, during the two countries' trade negotiations and before the US president's visit, is undoubtedly a kind of pressure tactic by our government, which is hoping that the US will not frequently investigate other trade matters in the future," a Ministry of Commerce official, who declined to be named, told China Daily.

"It's a reasonable self-defense for China, which is battling the US government's unfair case over tire imports," said Fu Donghui, deputy general manager of Allbright Law Firm. "If China still keeps silent under the current situation, other countries will follow the lead of the US."

The officials and analysts, however, all believed that the investigation would not impact US auto exports much.

"The action won't seriously impact Sino-US trade relations, and only lightly hit the US auto industry's exports to China," said He.

Zhong Shi, an independent auto analyst based in Beijing, agreed. "The investigations are more of a signal that China is exerting pressure on the US' trade protectionist moves."

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"And, the investigations may only impact General Motors among the US Big Three automakers, as Ford is not on the US government subsidy list and Chrysler doesn't do much business in China," Zhong said.

GM, which signed a $607-million purchase deal with its China joint venture Shanghai GM in September to export complete vehicles, vehicle kits, machinery and equipment from the US, said in a statement earlier that "GM will make sincere efforts to promote mutual understanding between the US and China and minimize trade conflicts between the two countries".

It is also "confident that the current trade-related disputes can be resolved in a constructive manner", GM said.

Statistics show that, in the first seven months, China imported 182,200 vehicles, 26.51 percent less than last year. However, Reuters, citing the American Automotive Policy Council, said that the Big Three US automakers exported only about 9,000 vehicles to China.