Beijing warns US over high taxes on Chinese steel products

China is disappointed at continued high US tax rates on Chinese steel products and will take necessary steps to protect the rights of its enterprises, a Ministry of Commerce official said on Saturday. 
The US moved closer to slapping duties on imports of stainless steel sheet and strip from China this week, issuing a final determination that the products were being subsidized and dumped in the US market at below fair value.
Wang Hejun, head of the trade remedy and investigation bureau at China’s Ministry of Commerce, questioned the way in which the US anti-dumping investigation is being conducted
“In the anti-dumping probe, investigating departments disregarded the cooperation of the Chinese government and Chinese enterprises,” Wang said in a statement.
The US has flouted World Trade Organization (WTO) rules by ignoring evidence offered by Chinese companies and has treated them unfairly because of their state-owned-enterprise status, Wang said.
The US Commerce Department has affirmed anti-dumping duties ranging from 63.86 percent to 76.64 percent on the imports, which will go into effect for five years if the US International Trade Commission (ITC) subsequently affirms its earlier finding that US producers were being harmed.
The commission is due to make its final determination on or about March 20.
The main cause of the challenges facing the steel industry is the sluggish world economy and falling demand, which calls for global cooperation not protectionism, Wang said.
Steel has been central to the self-image of China since the famous mills of Anshan and Benxi in China’s northeast rustbelt were liberated from Japanese occupiers in 1945.
In 1949, China had only 19 steel mills and seven working blast furnaces. Total output in war-ravaged China stood at just 158,000 tons, six times smaller than 1943, when Japanese-built mills in Anshan and Benxi worked at full tilt.
What China could not achieve by Stalinist state planning or Maoist revolutionary enthusiasm, it achieved by letting a million private-sector smelters bloom. But after decades of rapid expansion, the country is now saddled with more than 300 million tons of surplus capacity and a supply glut blamed by critics for threatening the survival of steel producers across the globe.
Beijing has repeatedly tried to “restructure” the sector with new product standards, environmental requirements or higher industry entry thresholds and has now pledged to shed 100-150 million tons of capacity.
The overcapacity problem was aggravated by a 4 trillion yuan ($620 billion) stimulus package launched in 2009, which led to a surge in steel demand and a flow of cheap credit that allowed mills to expand.
Production rose 310 million tons from 2009 to 2014, while capacity increased even more sharply.
Chinese steel output is now widely believed to have peaked. It hit 803.8 million tons last year, down 2.3 percent on the year, the first annual decline since 1981, but accounting for just under half of the world’s total.

Source: Arab News