Mexico files WTO dispute against China on textile subsidy

GENEVA -- Mexico requested consultations with China in the World Trade Organization Monday on several measures allegedly taken by the latter to support the production and exports of clothing and textile products, the WTO said in a statement.

Mexico notified the WTO that it had requested consultations because China appeared to maintain a wide variety of measures that support producers and exporters of apparel and textile products, both directly and indirectly.

Measures mentioned by Mexico included income tax exemptions; low-cost loans, extended loan repayment periods, and debt forgiveness provided by State-owned banks; and cash payments from Chinese government agencies at all levels to enterprises active in designated industries or undertaking activities encouraged by the government in its industrial policies.

Mexico claimed that these measures appeared to involve both prohibited and actionable subsidies that are inconsistent with China's obligations of WTO rules and they have an adverse effect to the interests of Mexico.

China's Ministry of Commerce said on Tuesday that China will properly deal with the dispute in accordance with the WTO's procedures.