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China television makers face huge US duties
( 2003-11-25 14:01) (Agencies)

US Commerce Department ruled Monday that China was selling television sets below cost in the US market, a decision that could result in import duties of between 28 and 46 per cent being slapped on some of the most popular brands sold in the US.

The ruling comes at a time when China's rising trade surplus is fuelling growing protectionist pressures in the US. The administration of President George W. Bush said last week it would impose new quotas on several categories of Chinese clothing imports, drawing an angry rebuke from Beijing.

Yesterday's decision will drive up consumer costs in the US for several brands of large colour televisions made in China, including Apex, Sansui and Emerson.

While US television makers were largely driven out of business by Japanese competition in the 1980s and Mexico in the 1990s, more than 4,000 Americans still assemble sets in the US for such Japanese companies as Sanyo, Sharp and Toshiba.

Five Rivers Electronic Innovations, a Tennessee company that employs 700 workers making colour televisions under the Philips and Samsung brands, filed the case last May. It was joined by unions representing US electrical and communications workers.

China has been the target of more than half the anti-dumping cases filed in the US over the past year.

Yesterday's decision means preliminary duties will be imposed on five large Chinese makers of television sets. The largest, Sichuan Changhong Electric, was hit with the highest duty of 46 per cent. China last year produced nearly 19m television sets worth more than US$2b, making it the world's largest manufacturer.

US television imports from China have grown sharply since the country joined the World Trade Organisation in 2001. In the first nine months of this year, China shipped 1.5m sets to the US, up from about 900,000 in the same period last year.

The duties will not be finalised until a ruling by the International Trade Commission, expected next May, on whether the US television industry has been injured by the imports.

The Chinese producers argue that their sales have largely displaced Mexico and other countries, and have not hurt US producers or workers.

Yesterday's decision will be particularly galling for China because Funai, the Malaysian producer which was also targeted, was deemed not to be selling below cost in the US. The company sold nearly 1m sets in the US in the first nine months of 2003.

The Commerce department further ruled that "critical circumstances" exist with respect to imports from China, meaning that the tariffs could be levied retroactively back to last August.

The US action follows similar moves by the European Union.

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