WTO finds US in breach of trade rules with tariffs on China
The World Trade Organization (WTO) has declared that the United States breached international trade rules by imposing multibillion-dollar tariffs on China.
In a 66-page report on Tuesday, the Geneva-based organization said the US duties broke trade rules because they applied only to China and were above the maximum rates agreed to by Washington.
The WTO’s three-member panel further said Washington had not adequately explained why its measures were a justified exception.
US President Donald Trump initiated a trade war with China in 2018 when he first imposed unusually heavy tariffs on imports from the country. Since then, the two sides have exchanged tariffs on more than 360 billion dollars in two-way trade.
With the unusually high tariffs, Trump sought to decrease the United States’ trade imbalance with China, which totaled 379 billion dollars in 2018. But he attempted to justify the aggressive tariff strategy by claiming that they were in response to Beijing allegedly stealing intellectual property and forcing US companies to transfer technology for access to the Asian country’s markets.
China, which rejected the allegations, later filed a complaint against the United States with the WTO.
The organization’s panel explained that it had looked only into the US measures and not China’s retaliatory tariffs.
“The panel is very much aware of the wider context in which the WTO system currently operates, which is one reflecting a range of unprecedented global trade tensions,” the report said.
The WTO further suggested that the United States bring its measures “into conformity with its obligations,” but also encouraged the two sides to work to resolve the overall dispute.