Gao Hucheng Said That China'S Trade Frictions This Year Are Grim.

Gao Hucheng, Vice Minister of Commerce, said that the situation of trade frictions faced by China this year will remain very severe.

"Slowing and sluggish growth of the world economy will lead to the intensification of international trade protection and the increase of trade disputes, which is basically a rule."

He made the above statement when he attended the "2008 international trade situation analysis conference" on the 9 day.

The trade friction situation in the first quarter confirms this view preliminarily.

As of the end of March, a total of eight countries and regions launched 17 anti-dumping and countervailing investigations against China, amounting to US $2 billion.

China has also encountered 5 "337 investigations" in the United States, and the number of cases and the amount involved have increased substantially.

Countervailing is the focus and difficulty.

Gao Hucheng believes that countervailing investigations will remain the focus of trade friction, and this year's situation is not optimistic.

In March of this year, Canada, the United States and Australia put forward countervailing investigations or anti-dumping and countervailing investigations on China's products. Especially, Australia was the first to launch a countervailing and anti-dumping investigation on Chinese products.

Since last year, countervailing has become a new field and hotspot in China's trade frictions.

The surge in countervailing cases has become a major feature and turning point of last year.

Gao Hucheng said that in the past, experts in China believed that countervailing investigations could not take place before China was identified as a non market economy country.

But this is not the case.

In 2004, Canada first launched a countervailing investigation of barbecues and steel fasteners in China.

In November 2006, the United States changed its practice of applying Countervailing Law to the so-called non market economy countries for 20 years, and launched the first countervailing investigation of Chinese coated paper.

Different from the anti-dumping investigation, the object of countervailing investigation includes government and enterprises, and the main point is the government's economic policies and institutional arrangements.

Therefore, WTO members are usually cautious about launching countervailing investigations.

In recent years, the number of countervailing investigations has not been more than ten each year.

However, in 2007, only one country in the United States launched seven countervailing investigations on China's standard steel pipes and non road tires. Canada also launched a countervailing investigation against China and two countervailing investigations.

"There is no precedent for such a filing frequency in the history of WTO's trade remedy."

Gao Hucheng said.

These countervailing investigations involve my exchange rate policy, financial system, reform of state-owned enterprises, foreign investment policy, tax policy, land policy, hydropower and gas pricing, and many other projects.

Gao Hucheng said that since countervailing is mainly aimed at the macro policies and systems of export, once the alleged items are recognized as subsidies, it will have a negative impact on the use of macroeconomic policies and regulatory measures in China.

Moreover, the items judged to be subsidized will often become the evidence for subsequent countervailing investigations in China, which will lead to more new countervailing investigations.

In this regard, the Ministry of Commerce has been "fully responsive", including continuing to promote the recognition of China's market economy status of the countries concerned, so far, 77 countries have recognized China's market economy status.

China and the European Union and the United States have established work and consultation mechanisms to solve the problems of market economy.

He also admitted that countervailing investigations are a new task. There are not many precedents to follow. They put forward higher requirements on the government level, enterprise level, lawyer level, intermediary level, and merchant association level.

Gao Hucheng said that after 2007, we have explored a lot of experience and achieved good results.

He said that he was pleased to see that both industry associations and enterprises should not only enhance their understanding of trade friction, but also improve their ability to control technology.

Focus on trade frictions with Europe and the US

Gao Hucheng said that the United States and Europe are still the focus of trade friction in 2008. Because of the economic slowdown and internal political pressure, the US and Europe are likely to take a more tough stance.

In fact, the trend of increasing trade frictions with the US and Europe appeared last year.

In 2007, the United States launched seven anti dumping and countervailing investigations in China, five anti-dumping investigations, three WTO dispute settlement cases, and the number of cases increased significantly compared with 2006.

The United States also launched 17 "337 investigations" to our country, involving nearly 2 billion dollars, representing an increase of 30.8% and 69% respectively over the same period.

As far as Europe is concerned, China has been the first target country of its anti-dumping investigations for six years in a row. The number of countervailing and anti-dumping investigations against China has now accounted for 1/3 of its total.

Since September last year, the European Union has frequently filed a case against China's steel products. In less than half a year, nine anti-dumping investigations have been launched, which directly affects the export of US $3 billion.

Gao Hucheng analyzed that the current US economy is slowing down and domestic economic nationalism is on the rise.

This year is the last year of Bush's election. It is also the year of the election of the United States. In order to seek support from Congress for some major issues, the Bush administration will have to compromise on the protectionism of the US domestic trade on some issues.

When the new US government comes into power, it will undergo a period of policy adjustment and running in order to fulfill its promise to voters, so that we can gradually return to the normal track of developing dialogues and trade policies.

All these factors may lead to the high incidence of trade friction between the two sides this year.

He predicted that the trade surplus, RMB exchange rate, intellectual property rights, market access technology standards, food safety and product quality in 2008, and fulfilling WTO's commitments, could become targets of speculation.

In the European Union, the trade situation faced by our country is equally unfavourable.

Due to the increasing pressure on the traditional industries and employment in the EU in recent years, the trend of EU economic nationalism and trade protectionism will be enhanced after the EU enlargement and the new generation of France and Germany come to power.

In addition, due to the strong demand for consumption in the EU market, China's trade export guidance to the United States