China announces its decision to appeal against the rare earth WTO ruling
China's Ministry of Commerce (MOFCOM) announced on April 17 that it would appeal the rare earths WTO ruling. “We will make every effort to appeal. Regardless of the outcome of the appeal, China's policy goals regarding the protection of the environment and resources will not change. We will continue to promote the management of the extractive industry and thus comply with WTO rules and support fair competition, ”said MOFCOM spokesman Shen Danyang at a monthly briefing on Thursday.
The US, Japan and the EU have been victorious over China in the Rare Earths case last month. The WTO Committee ruled that various Chinese export duties and quotas violated WTO requirements and could not be justified as derogations.
China believes the “WTO Rare Earth Ruling is unfair” and reiterated that the restrictions are there to conserve scarce resources and protect the environment.
On April 8, the victorious United States filed a preventive appeal against a decision of the WTO committee regarding Chinese rare earths in order to expedite subsequent appeal proceedings. Trevor Kincaid, a spokesman for the Office of the Trade Representative (USTR) said "This is a preemptive strike to secure urgent aid to American businesses and workers." However, some experts are of the opinion that “The US filing a complaint in the WTO dispute is an attempt to prevent China from delaying compliance with its conditions under the WTO ruling. Basically, the appeal focuses on a couple of fairly minor issues of evidence that don't have much bearing on the case ”. The US pre-emptive strike makes it clear that the United States is not giving its adversary any respite in this case.
“The loss of the lawsuit could be attributed to the administrative measures, which would mean that they did not live up to expectations and the government should review their management system. Both central and domestic governments should be more precise and sensitive in implementing this type of policy, ”said Liu Jingdong, director of international business law at the Institute of International Law at the Chinese Academy of Social Sciences, in an interview with the Economic Information Daily under the Xinhua News Agency.
China accounts for 90% of the world's rare earth production. Even in the event of an ultimate defeat at the WTO, the country will focus on rationalizing and controlling domestic production in order to strengthen its export restrictions. The government may raise resource and environmental taxes to raise prices and build strategic reserves to regulate supply and demand in the market. The Baotou Rare Earth Products Exchange is expected to regulate the country's spot rare earth trading.
According to China's Customs, Rare Earth Exports increased by 82,2% over the previous year on 7.174 tonnes of rare earth ores, metals and compounds in the first quarter, while the total export value increased by 2,7% over the previous year to $ 95.573.000 over the same period.
In March alone, China's Rare Earth Exports increased by 62,4% from the previous month and by 55% over the previous year on 2.671 tonnes of rare earth ores, metals and compounds. The average export price was up 14,9% from the previous month, dropping 36,9% year-on-year to 13472,5 US $ per ton from the latest data released by the Chinese Customs Statistics Information Center. The average export prices for rare earths recovered slightly this month. China's new round of REE warehousing boots the price.
Source: Source: Shen, Hongpo (17, April 2014)China announces decision to appeal against the WTO rare earth ruling.
