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Monday, December 19, 2011

Ohio's Two U.S. Senators Urge Probe of China Tariff Targeting U.S. Carmakers: Brown, Portman Eye Retaliation if Trade Rules Broken

Sens. Portman and Brown Want Chinese Auto Tariff Investigated 
CINCINNATI (TDB) -- Republican Rob Portman and Democrat Sherrod Brown lashed out together today against China's Commerce Ministry for imposing import taxes of up to 21.5% on American cars and SUVs with 2.5-liter engines or larger.  It was a bipartisan blast by two senators who saw the Chinese clamping down on free trade.  The Chinese claim U.S. imports are 'damaging the local car industry.' The new tariff targets GM, Chrysler, and some American products from Mercedes-Benz, BMW and Honda.  Brown, who is seeking reelection in 2012, and Portman, a former Trade Rep under President George W. Bush, said in a joint letter to current U.S. Trade Rep Ron Kirk, the Chinese tariff was "unfounded.''   They demanded a close review that could lead to retaliation against Chinese-manufactured products shipped to the U.S. market.  The Chinese contend that Chrysler and GM were bailed out by the US government in 2009, and that the other automakers receive tax credits and state subsidies to support their American factories.  The Daily Bellwether has the complete text of the letter Brown and Portman sent to Kirk, who is the Obama Administration point man on global trade:

"Dear Ambassador Kirk, We are troubled by China’s recent announcement that it will impose new antidumping duties on American automobiles entering China.  This unfounded decision by the Chinese government appears to lack justification and merit, especially given that China already imposes high tariffs and taxes on U.S. automobiles, severely limiting American auto sales in China. 
"Further, as we recognize the ten year anniversary of China’s entry into World Trade Organization (WTO) this week, we are particularly concerned that China is taking this step, which could violate China’s WTO commitments. This decision to impose additional tariffs on U.S. automobiles has a direct impact on Ohio exports and jobs in our state.  Ohio is a powerhouse automobile and auto supplier manufacturer, exporting thousands of Ohio-manufactured vehicles every year to consumers around the world. 
"Unfortunately, this is not our only area of concern with China’s trade policies.  We continue to be concerned by intellectual property violations in China, the Chinese government’s continued support for thousands of state-owned enterprises, the persistent problem of trans-shipment and mislabeling of products coming from China that evade U.S. customs duties, and the hoarding of rare earth minerals, among other areas.  Additionally, we believe that China is manipulating their currency to the detriment of American workers and exporters. 
 "We recognize China’s vital role as a U.S. export market.  In fact, over $2.2 billion of Ohio goods were exported to China last year, making it Ohio’s third largest export destination.  We understand China’s emergent role in the global marketplace, but China must compete fairly and play by the rules.  We ask you to closely review the new Chinese tariffs and to use all available tools to address this important issue. Thank you for your attention to this matter."
Meanwhile, China Daily ran a story contending the tariffs levied against U.S. imports would not seriously damage American automakers. But Brown believes the Chinese action would harm his state:  “Auto manufacturing is critical to Ohio’s economy, and our carmakers must be able to sell their vehicles freely around the world—and that includes China. Ambassador Kirk should investigate these new duties immediately and take action before our manufacturers suffer further harm."

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