Efforts 'paying off' on market status
(China Daily)
Updated: 2004-06-04 22:47

The US Government is in the very early stages of reclassifying China's status, with the US Commerce Department opening a public hearing on the issue on Thursday.

Wang Shichun, general-director of the Ministry of Commerce's bureau of fair trade for imports and exports under the Ministry of Commerce, said the Chinese Government's efforts on the issue had already started to reap dividends.

Wang said China has discussed, and got a positive response, from Pakistan, India, Egypt and South Africa.

New Zealand, Singapore and Malaysia have already granted the market economy status to China, with Australia also promising to recognize the status before it launches free trade agreement talks with China.

The European Union is expected to give a tentative assessment on the issue by the end of this month and the United States has agreed to set up a working group with China in order to have further discussions on the issue, he added.

The US hearing is taking place to identify relevant topics and issues for discussion by the China-US working group on market economy status.

Chinese officials and companies have called at the hearing for fairer treatment in anti-dumping rulings.

China's status as a non-market economy allows the US Commerce Department look at production costs in other countries, such as India, when it evaluates whether imports from China are unfairly priced or "dumped," in the US market.

"The fact is that China has changed and changed a lot," Dai Yunlou, a minister counsellor at the Chinese embassy, told the Commerce Department hearing in Washington.

"The Chinese economy today is very different from the centrally planned economy of decades ago," Dai stressed

But US companies participating in the hearing claimed that China fell short in each of the six criteria the United States uses to determine market economy status.

Countries must meet six criteria under the US Tariff Act of 1930 to be designated as market economies. Among them, labour issues and currency rates will be the two most difficult points and take most energy to solve.

James Jochum, US assistant secretary for import administration, said US deliberations on China's status would take at least as long as those on Russia.

"That was about 18 months from the petition being filed to completion... This is probably more complicated," he said.

But experts said the US criteria on market status is not a universal norm and is negotiable.

Anti-dumping investigations are widely viewed by the US industry as the most effective way of restricting imports from China.

Last year, approximately 50 per cent of all dumping cases accepted by the Bush administration were against Chinese imports.

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