China moves WTO against US subsidies to EV industry

Published March 27, 2024
Lianyungang: An aerial view of cars waiting to be loaded onto cargo ships at the Lianyungang Port, in eastern China’s Jiangsu province, on Tuesday.—AFP
Lianyungang: An aerial view of cars waiting to be loaded onto cargo ships at the Lianyungang Port, in eastern China’s Jiangsu province, on Tuesday.—AFP

GENEVA: China has initiated dispute settlement proceedings against the United States at the World Trade Organisation to safeguard its interests in the electric vehicle industry, the Chinese mission said on Tuesday and the WTO confirmed.

China said it was contesting “discriminatory subsidies” under the US Inflation Reduction Act that it said resulted in the exclusion of goods from China and other WTO countries.

The wide-ranging law provides billions of dollars in tax credits to help consumers buy electric vehicles and companies produce renewable energy, as President Joe Biden aims to decarbonise the mighty US power sector.

“Under the disguise of responding to climate change, reducing carbon emission and protecting environment, (these subsidies) are in fact contingent upon the purchase and use of goods from the United States, or imported from certain particular regions,” the Chinese mission said.

It said it was launching the proceedings “to safeguard the legitimate interests of Chinese electric vehicle industry and to maintain a fair level playing field of competition for the global market”.

A WTO official confirmed that a request from China for dispute consultations on the matter had been received, without providing details.

In Beijing, a spokesperson for China’s Ministry of Commerce said it urged Washington to “promptly correct discriminatory industrial policies, and maintain the stability of the global industrial and supply chains for new energy vehicles”.

There was no immediate res­ponse from the Office of the US Trade Representative in Washing­ton to a request for comment. WTO rulings on trade disputes are supposed to take six months after an adjudication panel is set up but often take longer.

If the WTO finds in favour of China, Washington could always appeal that decision into a legal void in place since December 2019 when the WTO’s top appeals bench ceased to function due to US opposition to judge appointments. The United States is calling for reforms to the Appellate Body which it accuses of over-reach and negotiations are under way but face many obstacles.

Published in Dawn, March 27th, 2024

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

System failure
Updated 12 Nov, 2024

System failure

Relevant institutions often treat right to internet connectivity with the same disdain as they do civil and political rights.
Narrowing the gap
12 Nov, 2024

Narrowing the gap

PERHAPS a pat on the back is in order for the ECP. Together with Nadra, it has made visible efforts to reduce...
Back on their feet
12 Nov, 2024

Back on their feet

A STIRRING comeback in the series has ended Pakistan’s 22-year wait for victory against world champions Australia....
Time to deliver
Updated 11 Nov, 2024

Time to deliver

Pakistan must display a serious commitment to climate change adaptation and mitigation at home.
Smaller government
11 Nov, 2024

Smaller government

THE IMF bailout programme has put the government under pressure to curtail its spending, especially current...
Unsafe inheritance
11 Nov, 2024

Unsafe inheritance

DESPITE regulations, the troubling practice of robbing women of their rightful inheritance — the culprits are ...