Breaking news. Bloomberg and other sources report that duties up to 31% will be imposed on Chinese produced OCTG (Oil Country Tubular Goods) on the basis of their production with the support of unfair government subsidizes. Average duties are expected to be about 21%, according to the Commerce Department preliminary report.
In my International Trade Class, we discuss the subject of mercantilism, which is the best way to describe China’s trade policy. When I was in college, the Chinese called the US “imperialists.” This Department of Commerce finding supports the claim made by many laid off US manufacturing workers that today China, Inc. is a “commercial imperialist.”
We believe that this case and the forthcoming Chinese tire case (see our blog story dated July 2) are bellwethers of the road ahead for trade relations between the US and China. Trade need not be a zero sum or negative sum game. But artificially manipulating a firms “comparative advantage” is not the way that trade can be sustained in the world today.
China produced 38% of world crude steel production in 2008 according to World Steel Association . With that much power must come discipline.
Harm to the US manufacturing industry continues as a result of both the past and current adminstration’s failure to act on China’s mercantilist trade practices and predatory pegged currency scheme. We are glad to see the Commerce Department is at least functioning and reviewing trade cases.
Hey Washington, how about some change?
How has the impact of Chinese currency manipulation or mercantilism/subsidies impacted your company or your employment? Post your comment here.