When China joined the WTO in 2001, the country agreed to get rid of export restraints on these raw materials. However, it has failed to meet its commitments in this regard.
In a statement, EU Trade Commissioner Cecilia Malmström said, “We cannot sit on our hands seeing our producers and consumers being hit by unfair trading practices. The past two WTO rulings on Chinese export restrictions have been crystal clear – these measures are against international trade rules. As we do not see China advancing to remove them all, we must take legal action.”
The Director General of Eurofer, Axel Eggert, said, “Chinese export duties and export quotas have had a massive distortionary impact on both US and EU manufacturers. These industry players rely on access to the strategic resources in order to compete globally.”
The raw materials concerned are antimony, cobalt, copper, chromium, graphite, indium, lead, magnesia, talcum, tantalum, and tin. Tin and cobalt in particular are important inputs in some steel production. China’s export duties provide an unfair competitive advantage to that country’s producers at the expense of free and fair international competition.
“It is incumbent upon US and EU policy makers to do what they legally can to prevent international competitors from taking advantage of the world trade system. The EU and US move is thus both welcome and significant”, addedEggert.
“China’s lack of progress on its WTO commitments and its recalcitrance in implementing the necessary reforms is yet more evidence that the country has a long way to go until it can be granted Market Economy Status.