The United States is not required to recognize China as a “market economy” by the end of next year, a Commerce Department official said Friday, taking a position at odds with Beijing and in line with U.S. steel producers.
China argues the terms of its entry into the WTO requires other countries to treat it as a market economy beginning in December 2016. Such an upgrade would require the Commerce Department to change how it calculates anti-dumping duties in cases brought against Chinese suppliers, a move the U.S. steel industry strongly opposes.
“The protocol of China’s accession to the WTO contains certain language which is scheduled to lapse in December 2016,” the Commerce Department official said in an email, speaking on condition he not be identified. “What is clear, however, is that the protocol does not contain any requirement that WTO members treat China as a market economy country for antidumping purposes by the end of 2016.”
U.S. law requires the Commerce Department to examine six criteria for determining whether to upgrade any country to market economy status. Those are currency convertibility, free bargaining over wages, openness to foreign investment, government ownership or control of production, government control over prices and other appropriate factors. Commerce will only re-examine the issue if it “receives a properly filed request,” the Commerce official said.