WASHINGTON (Oct. 14, 2010)—Supporters of the tariffs the Obama administration levied against passenger and light truck tire imports from China say they are encouraged by a news report that a World Trade Organization dispute panel has issued a confidential preliminary report supporting the tariffs.
The Bureau of National Affairs' Daily Executive Report ran a story Oct. 12 saying that anonymous sources confirmed the existence of the Sept. 24 preliminary report and its contents.
The United Steelworkers union appealed for trade relief against Chinese tire makers and exporters in April 2009, under Section 421 of the Trade Act. The International Trade Commission and the Office of the U.S. Trade Representative found evidence of harm to the domestic tire industry because of Chinese imports. In September 2009 President Obama ordered tariffs equal to 39 percent the first year, 34 percent the second and 29 percent the third, before reverting to the previous 4 percent in 2012.
A spokesman for the United Steelworkers union said the USW hadn't heard of the WTO report before the BNA story. “We have not seen it, nor should we,” he said, because WTO confidential reports are strictly for member governments.
“We've always said China has every right to appeal,” the USW spokesman said. “We're an organization well suited to the negotiation of deals and the rules of trade. But all the participants have to live by those rules.
“If you negotiate deals, they're meaningless unless you enforce them,” he said. “Ten years ago China pledged it would play by the rules, and it hasn't.”
Spokesmen for the Tire Industry Association and the Rubber Manufacturers Association also said they had not seen the WTO preliminary ruling. TIA opposed the tariffs, insisting they would create tire shortages and hardships for tire retailers without helping domestic tire manufacturers. The RMA expressed no public opinion on the tariffs, although two of its members—Cooper Tire & Rubber Co. and Toyo Tires U.S.A. Inc.—opposed them.
“We knew China was appealing the process, so we're not surprised,” said Paul Fiore, TIA director of government and business affairs. “The news is a little sooner than we expected.”
The WTO panel is expected to issue its final ruling Nov. 8, after which the decision will be made public. Officials of USTR and the ITC declined comment on the preliminary report, citing its confidentiality. The WTO press office in Geneva, Switzerland, did not respond to inquiries.