Issue Date: December 24, 2012
Trade Disputes Go Global
China was at the center of many international trade disputes during the year.
In February, the World Trade Organization ruled that China’s export duties and quotas on raw materials used in the chemical, steel, and aluminum industries violate international rules. Materials at issue included bauxite, coke, and fluorspar, a raw material used to make hydrofluoric acid.
Then in March, the U.S. joined with the European Union and Japan in filing a complaint with WTO challenging China’s restrictions on exports of rare-earth minerals, which are used in wind turbines, electric-car batteries, and smartphones. Formal talks failed to resolve the dispute, and in July the complaining parties asked for a WTO investigation.
Not to be outdone in the trade dispute game, China said in July that it would launch an investigation into whether solar-grade polysilicon from the U.S. and South Korea was being sold in China below cost. China’s Ministry of Commerce said the inquiry would focus in part on whether the U.S. government is improperly subsidizing polysilicon production.
Three months later, the U.S. Department of Commerce upped the ante in the solar dispute with China. The department found that 61 Chinese firms had sold solar cells and panels below cost. It proposed tariffs of 36% and 24%, respectively, for Suntech Power and Trina Solar, China’s two largest solar-cell makers.
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