In the latest action taken by the U.S. government against what it deems as unfair trade practices by China, U.S. Trade Representative (USTR) Michael Froman announced on Tuesday the U.S. intends to file a complaint with the World Trade Organization against high poultry tariffs imposed by China.
Calling China’s heavy duties on poultry imports from the U.S. “unfair” and “unjustified,” Froman reiterated the Obama administration’s support of U.S. farmers against Chinese actions: “American farmers deserve a fair shot to compete and win in the global economy and this Administration will continue to hold China responsible when they attempt to disadvantage our farmers, businesses and workers,” he said.
Trade between the world’s two largest economies has long been a point of contention. This would be the 12th action the administration has brought to the WTO in regards to Chinese trade policy. The U.S. has won all previous cases.
The most recent WTO complaint brought by the U.S. came in 2013, when it won the international trade body’s support in enforcing a ruling that required China to halt its average of 64.5 percent duties on U.S. poultry producers, which forced the U.S. to cut its exports to the Asian power by 80 percent.
In an email sent by Tyson Foods to Law Street Media, the processed poultry giant expressed support for the ongoing fight for freer markets in China:
“We believe in open trade and hope that our government’s latest action will result in a resolution of this issue soon,” a spokesperson from the company wrote.
Following an outbreak of highly pathogenic avian influenza in December 2014, a handful of top importers of U.S. poultry–including mainland China, the country’s sixth most lucrative poultry market to which $153 million worth of chicken meat and eggs were sold in 2014–announced bans or restrictions on U.S. bred meat and eggs. Despite requests from the U.S. for China to lift the ban, and WTO-backed calls to lower poultry tariffs, China has yet to comply with either.
China’s import ban of U.S. bred chicken broiler parts–frozen thighs, breasts, and wings–would need to be lifted before any action taken by the WTO to force China to lower their anti-dumping and countervailing duties would have an effect. As Hong Kong interacts with international trading partners on its own, the trading decisions of Beijing only affect the mainland.
Toby Moore, Vice President of Communications with the USA Poultry and Egg Export Council, an advocacy body for U.S. poultry exports, expects the ban to be lifted in the near future.
“Its been a long term issue and I think once China gets its economic issues straightened out I think [U.S.-China trade relations] will be a little better,” he told Law Street Media during a phone interview on Tuesday. “China tends to be a country that links trade issues with unrelated issues.”
Calling the U.S. and China trade relationship “tenuous,” Moore claims that historically, China’s stricter trade stances reflected unrelated domestic troubles, or a response to an unrelated action taken by the U.S. He speculated that China might respond to a threatening U.S. action–meeting with the Dalai Lama, for instance, or acting on China’s island building in the South China Sea–with an aggressive new trade measure.
However as the newest wrinkle in the tit-for-tat world of U.S. and Chinese trade turns out, Tuesday’s announcement came with a flurry of bi-partisan support from Senate members:
“Today’s announcement sends a clear message that the United States will continue to hold China’s feet to the fire until it plays by the rules and opens up its market to our poultry,” said Senator Chris Coons, a Democrat from Delaware and a co-chairman of the Senate Chicken Caucus.
“Trade works when the rules are followed, and it is imperative that China—the world’s second largest economy—lives up to the rules it agreed to when it joined the WTO in 2001,” said Senator Johnny Isakson (R-GA).