China is obviously not a market economy, European Union Trade Commissioner Cecilia Malmström told reporters on Tuesday, but that does not matter for a decision countries have to make this year about how they calculate anti-dumping duties on Chinese goods.
[Adam Behsudi| July 20, 2016 |Politico]
"The issue of China's market economy status is not really an issue of market economy because obviously China is not a market economy," Malmström told reporters in a joint call with U.S. Trade Representative Michael Froman to discuss a new trade case against Beijing. "It's about some provisions in a WTO accession protocol that we are discussing intensively now in the European Union and in other countries."
China is now classified as a "non-market economy" under most national laws , allowing anti-dumping authorities such as the Commerce Department to calculate duties on Chinese goods using prices from third countries instead of from China itself. However, a commitment in China's 2001 WTO accession agreement appears to require countries to grant China market economy status, or at least the benefits of that designation, by Dec. 11 of this year.
Last week, U.S. officials told China during a discussion of the WTO Goods Council that the provision does not require members to grant Beijing market economy status, and, surprisingly, Chinese officials agreed. But China argued the provision does require the United States and other members to stop using "non-market economy" methodology to calculate duties on Chinese goods. To read more of Doug's story, click here.