China Expresses 'Firm Opposition' to Bevy of New US Section 301 Action
China announced that it is "firmly opposed" to both the U.S. decision to open a new Section 301 investigation on allegedly unfair practices in China's maritime, logistics and shipbuilding sectors (see 2404170029) and President Joe Biden's call for a "tripling" of the existing Section 301 tariffs on Chinese steel and aluminum (see 2404170040).
In a pair of news releases, China's Ministry of Commerce said the accusations against the maritime, logistics and shipbuilding sectors lack a "factual basis" and that the prospect of raising the steel and aluminum duties amount to "typical unilateralism and protectionist practices," according to an unofficial translation.
On the new Section 301 investigation, China said the move "goes against economic common sense" since multiple U.S. reports show that U.s. shipbulidng "lost its competitive advantage many years ago due to over-protection." The ministry pointed to U.S. subsidies to its industries as an indication of its hypocrisy as well as a World Trade Organization ruling against the existing Section 301 tariffs imposed for Chinese theft of U.S. intellectual property.
The ministry also pointed to the WTO in critiquing the prospect of greatly increased steel and aluminum tariffs, noting a WTO decision finding U.S. Section 232 steel and aluminum duties violate global trade rules (see 2212090060). China added that the measures will "undermine the security and stability of global industrial and supply chains."
Biden urged the Office of the U.S. Trade Representative on April 17 to consider "tripling" the current average 7.5% rate as part of its ongoing review of Section 301 tariffs.
Meanwhile, the new Section 301 investigation said it will center on Chinese industrial policies, including directed mergers; nonmarket advantages to Chinese firms; and the network of Chinese "upstream suppliers, foreign ports and terminals, shippers, and equipment and logistics software that allow advantageous use of information."