Experts: Beware Of The Ripple Effect Of US Trade Protection Policy

After the US government upgraded its trade protection measures to China, the European Union and some developing countries went all the way to improve trade barriers.

Some domestic manufacturing and foreign trade practitioners and experts believe that the reality of trade frictions with China is becoming normal. We need to form a trade remedy mechanism that the government, industry associations and enterprises perform their duties and complement each other to prevent the "ripple effect" of the US trade protection policy from spreading.

Facing the unprecedented grim situation of dealing with trade frictions

Professor Shen Dingli, director of the center for American Studies at Fudan University, points out that the escalation of US trade protection measures to China not only directly affects Sino US economic and trade relations, but also plays a very bad role in limiting the "export of China" to other countries in the world.

Following the United States, in February this year, the European Union launched anti-dumping investigations on imported coated paper from China. At the end of last year, Argentina also launched an anti-dumping investigation on the tires originating in China.

Gong Baihua, director of the Information Department of Shanghai WTO affairs consulting center, said that with the United States as the representative, the field of foreign trade protection to China is expanding from trade in goods to exchange rate, service trade, intellectual property and investment, and the dispute over trade friction has also spread from single product to the whole industry, and finally to the policy and institutional level.

At present, the dual Anti China cases in the United States have accumulated a lot, and there are thousands of cases concerning intellectual property rights conflicts. Therefore, the frequency and intensity of the US trade protection measures to China will be higher this year.

It is worth noting that the US budget of the International Trade Commission was increased by US $80 million in the US budget announced in 2011 this year, so as to train 328 trade experts who provide advisory services to American enterprises, help 23000 enterprises to start or increase exports, and increase the number of SMEs exported to at least one overseas market by 50% over the next 5 years.

Experts point out that the United States International Trade Commission is also an organization that initiates and arbitrates trade friction. Training hundreds of trade experts who provide advisory services to American enterprises will undoubtedly increase the number of cases of trade friction.

It is more likely that the problem of China's export enterprises will be greatly affected. This year, the United States will increase its pressure on the RMB exchange rate.

In early February this year, Obama said that China and the whole Asia would continue to become the huge export market of the United States, but the exchange rate issue must be dealt with to ensure that US products would not face "huge competitive disadvantage".

Since then, Obama told us business week that he will have some very serious negotiations with Chinese leaders on the RMB exchange rate this year.

He even publicly stated that the United States needs to monitor the global foreign exchange policy to ensure that other countries do not seek unfair advantage through devaluation of their currencies.

Zhao Yaping, general manager of Shanghai animal husbandry Qilin import and Export Co., Ltd., said that the issue of exchange rate has become a big problem for many importers and exporters. Neither production enterprises nor foreign trade enterprises are afraid to take long orders because of fear of large exchange rate changes.

Conflicts often occur in overcapacity industries.

Zhang Junsheng, director of the information center of China WTO Research Institute, University of International Business and Economics, and other experts believe that there are internal causes for frequent trade frictions against China. Conflicts often occur in industries with excess capacity both globally and domestically, such as iron and steel industry.

Under certain circumstances of foreign demand, some domestic industries have been disorderly competition due to overcapacity, which has been lowering prices. The phenomenon of homogenization of products is very obvious, causing serious dissatisfaction among the same industries in other countries. In a few years, China's automobile, machinery manufacturing and ship manufacturing industries may also become the focus of foreign "double opposition" as well as steel industry.

The main domestic countermeasures to curb international trade frictions are to effectively limit excessive investment and the excess capacity resulting from it. We must make internal adjustments in the industrial structure, product mix, consumption and investment structure and regional development structure, change the imbalance state, and reduce the pressure and pressure on the outer circumference.

On the issue of forming a mature and effective trade remedy system, Zhang Junsheng, assistant president of Shanghai WTO affairs consulting center, and Gao Yong, vice president of China Textile Industry Association, put forward the following five suggestions: Yao Weiqun, vice president of China Textile Industry Association, etc.

First, encourage enterprises to actively innovate in technology, improve the quality management system, and work hard in brand, deep processing and high added value.

Zhang Junsheng said that the pformation of foreign trade structure and foreign trade enterprises is a long process, but the pressure of trade protectionism will have a certain incentive effect on the development of China's economic and trade, especially the deepening of economic restructuring and acceleration of the pformation of the operational mechanism of enterprises.

At the present stage, we should select a batch of export production enterprises or industries with high degree of marketization and high possibility of involvement in the operation mechanism, and accelerate the pformation of the operation mechanism of enterprises, and prove the fact that these enterprises or industries are completely marketization in legal form.

Two, improve enterprises' awareness and application familiarity with WTO rules.

Because the legal system of the World Trade Organization has not strictly defined the "non market economy conditions" and formulated specific rules for handling it.

Enterprises should actively study, correctly understand and grasp the relevant laws and regulations of WTO members, and put the contents of "special provisions" under the WTO legal framework for assessment, and examine the conditions according to the requirements of the pparency rules.

Three, find ways to avoid trade barriers.

One way is to change competition into cooperation, for example, high-tech products such as solar panels can consider forming strategic cooperation with Germany and other European countries, so as to achieve a win-win situation. The other way is to invest in the countries where the prosecuting parties are located so as to avoid trade barriers. At present, some domestic enterprises have moved to the importing countries to control the cost of the relatively simple assembly link, and retain the main production links in the country. This practice is also worth learning from.

Four, better play the role of trade associations.

The cost of individual enterprises responding to litigation is very high. Through industry associations, enterprises can jointly respond to anti-dumping suits, which not only reduces the cost of litigation, but also combines enterprises with the same situation, and with the help of government agencies, to deal with trade protection, and actively communicate with the target government and industry.

Trade associations also play a major role in regulating export order, rationally grasping export rhythm and avoiding low price bidding.

Five, we should establish a monitoring and early warning mechanism for trade frictions, and improve and improve the "four body linkage" trade friction monitoring and early warning mechanism of the central government, local commercial authorities, enterprises and intermediaries.

Yao Weiqun suggested that one is to establish a regular assessment mechanism for China's trade operation environment, which is authorized by the State Council as the responsible department. The two is to establish a dynamic monitoring mechanism for China's trade operation, which is authorized by the State Council as the responsible department. The three is to establish an internal consultation mechanism authorized by the Ministry of Commerce as the stakeholder of the responsible department. Four, it is to establish a lobbying mechanism for Chinese exporters and importers, importers and consumers to take the lead led by industry organizations. Five is to establish an intermediary and independent information service mechanism for third parties to the government, producers, traders and consumers.