The WTO on Tuesday upheld a complaint by China over additional US duties on about US$250 billion of Chinese goods, a decision that sparked outrage in Washington.
The Geneva-based body has been caught in the middle of trade tensions between Washington and Beijing, and has faced relentless attacks from US President Donald Trump.
The tariffs, imposed in 2018, marked the beginning of the trade dispute between the world’s two largest economies, but a panel of experts — set up last year by the WTO Dispute Settlement Body to review the US move — ruled that the tariffs on Chinese goods were “inconsistent” with global trade rules and recommended that the US “bring its measures into conformity with its obligations.”
The decision was met with ire in Washington, with US Trade Representative Robert Lighthizer saying that it proved the WTO “is completely inadequate to stop China’s harmful technology practices.”
“The Trump administration will not let China use the WTO to take advantage of American workers, businesses, farmers and ranchers,” he said.
Beijing welcomed the move as an “objective and fair ruling.”
“China also hopes that the United States will fully respect the rulings of the expert group ... take practical actions to meet China and other WTO members half way, jointly maintain the multilateral trading system, and promote the stable and healthy development of the world economy,” a Chinese Ministry of Commerce spokesman said.
In a 72-page report, the panel said that Washington had “not met its burden of demonstrating that its measures were provisionally justified” under international trade rules.
In particular, it rejected the US argument that the tariffs were applied to products it said had benefited from practices that the US considers are contrary to “public morals,” such as theft, misappropriation and unfair competition.
“The United States had not met its burden of demonstrating how its restrictions contributed to protecting its public morals and did not extend beyond what was necessary,” the report said.
Lightizer said in response that the US report had cited thousands of pieces of evidence showing China’s unfair trade practices, which “have cost US innovators, workers and businesses billions of dollars every year.”
He said the WTO ruling showed that it “provides no remedy for such misconduct.”
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