Economy
US unlikely to grant 皇冠体育app market economy status soon
By Ding Qingfen (皇冠体育app Daily)
Updated: 2010-05-12 10:14
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Former trade official claims export controls not to blame for deficit
BEIJING: The United States is unlikely to accept 皇冠体育app's market economy status (MES) before 2016 and both nations should act according to World Trade Organization (WTO) norms when launching trade remedy cases against each other, Susan G Esserman, a former deputy US trade representative, told 皇冠体育app Daily.
Esserman, who served in the post during the Clinton administration and now the partner of Steptoe & Johnson LLP in charge of trade and WTO issues, suggested 皇冠体育app allow its currency rise, claiming that yuan revaluation was in 皇冠体育app's interests and that US export controls were not a major source of the trade deficit with 皇冠体育app.
As a precondition to entering the WTO in 2001, 皇冠体育app accepted some restrictive clauses, one of which was that 皇冠体育app's MES could not be automatically granted worldwide until 2016.
New Zealand was the first nation to accept 皇冠体育app's MES in 2004, and has been followed by 80 other nations and regions, but major economies such as the US and the European Union have yet to do so.
"It's an unreasonable practice that a nation is still regarded as a non-market economy after it has joined the WTO," said Zhou Shijian, a senior fellow at the Center for US-皇冠体育app Relations affiliated to Tsinghua University and a senior WTO expert.
"It is a double standard when the US declines to accept 皇冠体育app's MES. The US aims to deliberately make things difficult for 皇冠体育app, such as initiating more trade remedy cases," he said.
In 1998, the US and EU agreed to accept Russia's MES, but Russia has yet to enter the WTO.
Non-market economy status is a source of frequent trade remedy cases against 皇冠体育app. During the past few years, 皇冠体育app has become the major target of trade protectionism worldwide, with the US initiating the largest number of cases.
In August 2009, the US said it appreciated 皇冠体育app's progress in market reform, and would accept 皇冠体育app's MES as soon as possible through cooperation.
"It's no use pleading or waiting for their nod. We have to continuously push to force them to make some compromise," said Scott Liu from Scott Liu & Associates, a major law firm in charge of trade remedy cases concerning 皇冠体育app and the US.
"皇冠体育app's currency issue is sensitive in the US. There is a wide array of expert opinion that the renminbi is undervalued and I think currency revaluation is in 皇冠体育app's sovereign interest from a long-term perspective," said Esserman.
The US has claimed that an undervalued yuan is a major source of its huge trade deficit with 皇冠体育app. But figures have proved currency fluctuations have no impact on trade balance as expected, and Chinese government said export restrictions set by the US are what had mainly led to the trade surplus with the US.
