Thursday, December 13, 2007

Learn mandarin - China won't change auto part tariffs

BIZCHINA / Automobiles & Motorcycles

China won't change auto part tariffs
(Shenzhen Daily/Agencies)
Updated: 2006-03-20 17:32

China won't change the high tariffs it places on some auto-part imports
in the near term, despite U.S. claims they represent unfair competition,
an official at China's top economic planning agency said Sunday.

China began levying higher tariffs on some auto-part imports April 1,
partly in an effort to encourage more local production.

In February, U.S. Trade Representative Rob Portman threatened to take
action at the World Trade Organization unless China took measures soon on
the tariffs.

But Li Wanli, a division chief under the Department of Industrial Policy
in the National Development and Reform Commission, said the United
States' complaints were groundless.

"We consider (the auto-parts tariff policy) complies with WTO rules," Li
said. Li said the policy doesn't target specific firms.

China classifies some imported auto parts as complete vehicles and
charges a tariff of up to 30 percent on them. That compares with a much
lower tariff of between 13 percent and 17 percent for other imported auto
parts.

Starting July 1, 2006, the higher tariff will be extended to any imported
auto parts valued at 60 percent or more of the total price of the
complete vehicle the parts would be used for.

The government had sought opinions from companies, some of them from the
United States, before introducing the auto policy, Li said.

In early March, a delegation led by James Mendenhall, general counsel for
the U.S. Trade Representative, met Chinese officials to talk about the
tariff dispute and intellectual property rights.

China's government ministries haven't publicly disclosed any immediate
moves to solve the tariff dispute. But the trade issue is expected to be
on the agenda during President Hu Jintao's visit to Washington in April.

The government is facing increasing pressure to allow more imports from
the United States and to let the yuan rise further to reduce what the
United States. claims is an "unfair export advantage" for China.

China's trade surplus soared to a record-high US$102 billion in 2005,
more than triple the US$32 billion in the previous year.

(For more biz stories, please visit Industry Updates)

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