Is China Manipulating its Currency, or is the US Manipulating its Culture?

Gietner's accusation that China is a currency manipulator and China's rebuttal that this is just another protectionist rhetoric from the US revived the debate as to whether China has violated international rules by undervaluing its currency. What are the real reasons to the swelling American national debt and who should bear the blame? We've heard of many theories and now Alireza Gharagozlou, a lawyer currently pursuing advanced studies at NYU, offers another interesting explanation - culture - in his new article linked below. Fellow blog readers are most welcome to comment on his paper by posting comments either on this blog or directly to him.

When Did Scrooge Become a Role Model? Why Criticism of America's National Debt is Misplaced

Alireza Gharagozlou

Abstract: As the world debates the economic crisis, it does so without considering two historically important ideas: the stigmatization of miserliness and the prohibition of usury. Although these ideas were once keystones of society, they are missing from the current discourse. This paper seeks to reintroduce those ideas. It starts by exploring the reason why cheapness was stigmatized, and why usury was illegal for hundreds of years. The paper then applies this historic lens to a frequently debated topic - the national debt and China-U.S. economic relations.

Who said Obama is not pro-trade?

From Barack Obama's inaugural address:

"To the people of poor nations, we pledge to work alongside you to
make your farms flourish and let clean waters flow; to nourish starved
bodies and feed hungry minds. And to those nations like ours that
enjoy relative plenty, we say we can no longer afford indifference to
suffering outside our borders; nor can we consume the world's
resources without regard to effect. For the world has changed, and we
must change with it."

Does this mean that the US is willing to get rid of its high
agricultural subsidies, which has been a main obstacle to the DDA?

China fastened its trade remedy machine

The MOFCOM recently launched an anti-dumping investigation against
steel and iron fasteners from the EU. This is the first
counter-investigation taken against a foreign investigation. It would
be interesting to see how the case plays out.

保卫紧固件产业还应善用WTO规则
2009-01-20 15:56:04.0 中国工业报

"欧盟已经获得我国立案的信息，欧洲工业紧固件协会也将开会讨论该案的应对情况。"1月12日，曾多次组织企业到欧盟进行抗辩游说的浙江省嘉兴市紧固件进出口企业协会副秘书长张峰对中国工业报记者透露。此时距离中国商务部对原产于欧盟的进口碳钢紧固件发起反倾销立案调查已近半月。而利害关系方向商务部进出口公平贸易局和损害调查局申请或登记应诉的20天时限，也所剩不多。
　　"截至日期过后，我们会将登记信息进行汇总整理然后公告。现在还不能透露任何情况。"商务部损害调查局相关人员15日对本报记者表示。
　　"这是我国首次利用WTO规则对国外的贸易救济措施进行反制裁的一个案件。我们协会及会员企业坚决支持对欧紧固件产品发起反倾销调查。"张峰表示，我国加入WTO这么多年了，希望政府能积极灵活地运用其规则来保护自己的利益。
　　这场博弈，是否将成为我国紧固件行业的"斯大林格勒保卫战"？
　　反倾销我企业打响保卫战
　　据不完全统计，目前我国紧固件生产和贸易企业达近10000家，从业人员约250万人，2007年各类紧固件总产量约为525万吨，销售收入约为440亿元人民币，出口数量为257万吨，出口金额为32.5亿美元。
　　由于产量世界第一，且半数出口，我国的紧固件产业历来就是国外贸易救济措施的重灾区。但长期以来，中方出口到欧盟的大多是中低端紧固件产品，而欧盟企业则主打高端。近年来，我国的紧固件产业主动谋求转型，从出口导向转向积极扩大内需和产业结构升级，而企业也在致力于提高产品的科技含量。据紧固件专业协会会长冯金尧表示，已有部分企业跻身于国内高端市场。
　　但欧盟此时却高高挥起了两个大棒。一方面，在我国进口量激增的情况下，一些企业大幅降低产品价格，倾销高端产品，导致我国的紧固件企业迟迟不能实现从低端到高端的产业升级，只能在低端进行残酷的竞争。另一方面，欧盟再次发起了贸易救济调查，且滥用反倾销规则，对我征收高额反倾销税。
　　2007年11月9日，应欧盟工业紧固件协会的申请，欧盟反倾销委员会立案对我国出口至欧盟的碳钢紧固件产品发起了反倾销调查。据了解，此次调查期为2006年10月1日至2007年9月30日，全国涉案企业1400余家，涉案金额达7.6亿美元，涉案数量60多万吨，占同期全国出口的25%左右。2008年12月3日，欧委会裁定，今后五年内对中国产碳钢紧固件征收加收63%~87%的反倾销税。
　　2008年11月30日，中国机械通用零部件工业协会紧固件专业协会和47家紧固件企业代表中国紧固件产业，向商务部正式递交了反倾销申请书。"对欧进口紧固件发起反倾销调查，有助于我国紧固件企业获得更多的高端市场份额，实现产业升级。"张峰表示。
　　保产业应诉欧委会滥用规则
　　"欧委会给欧方在华投资企业优惠待遇，而对中国企业严重歧视，致使在终裁披露中，意大利和西班牙2家起诉方在中国的投资企业获得零税率，而其他中资企业则获得了高达87%的反倾销税。"张峰对本报记者表示，如果2009年2月9日欧盟开始征税，中国企业将完全退出欧盟市场。
　　他告诉本报记者，"近段时间以来，中国紧固件工业协会与我会正积极与德国紧固件制造协会、欧盟紧固件工业协会协商。他们不认可欧委会的结论，认为反倾销税率太高，也不能接意大利和西班牙在中国的合资企业获得零税率的结果，他们现在正在考虑撤诉。但其可能性微乎其微。"
　　一旦开始征税，欧盟紧固件市场将面临由中国企业退出而造成的每年60多万吨的缺口，"而获得零税率的两家企业，将可以利用这个机会扩大采购和生产规模，彻底控制中国对欧出口渠道和市场，危害我民族紧固件产业。"在提交给商务部产业损害调查局和中国机械工业联合会的文件中，嘉兴市紧固件进出口企业协会表示，鉴于此次欧委会在对我国碳钢紧固件产品的立案调查中，有许多做法明显违反WTO规则，"建议国家有关部门采取相应措施，以维持我国紧固件行业健康、安全发展，保护我国对欧正常出口。"
　　首先，由于在2009年2月9日终裁前，欧盟成员国常驻欧盟代表和欧盟成员国贸易部长会议还将就该案进行讨论，希望商务部及我国的驻外机构能够游说欧盟各成员国，使他们反对对我国紧固件产品征税。
　　其次，将欧委会滥用反倾销规则的做法上诉到WTO，进行多边磋商，在WTO框架内规范欧委会的调查行为。协会表示，除了在调查过程中采用双重标准为欧方在华企业牟利外，欧盟紧固件行业并没有受到中国进口产品的损害，不符合欧委会发起反倾销调查的要求。
　　"本案起诉书中所列举的调查期内欧盟紧固件产业的12个经济指标中，仅有市场份额和赢利水平2个指标同比出现小幅下降，产能利用率这1个指标持平，其余如销售价格、雇工、投资等9个指标全部同比大幅增长。欧委会仅基于2个负面指标而忽略另外9个正面指标就对我国紧固件发起反倾销调查是不符合WTO规则的。"
　　此外，协会认为，还"应制裁两家欧盟起诉方在华投资企业"。"他们既是原告又是被告，原因就是希望通过反倾销来打击在中国的竞争对手，以达到控制和占有中国对欧盟紧固件出口渠道的目的。"

Lecture in Seattle: Japan-China Trade Disputes: 'Aggressive Legalism' with a Confucian Touch

At the kind invitation of Prof. Saadia Pekkanen at the University of Washington, I will be speaking in Seattle next week on two occasions. Interested blog readers in the area are most welcome to join both events. Details are available below.

JANUARY 15, 2009

Thursday, 3:00-4:00 pm

Thomson Hall, Room 317

Henry Gao, Associate Professor, School of Law, Singapore Management University

Japan-China Trade Disputes: 'Aggressive Legalism' with a Confucian Touch

The first Chinese lawyer to ever work at the WTO Secretariat, Professsor Gao has published widely on all issues relating to China and WTO. He has spoken at conferences across the world and trained hundreds of government officials on WTO issues. A consultant to many national governments and international organizations, including the WTO, the World Bank and APEC, he is also a frequent commentator in major international media such as the Wall Street Journal, CNN, and Bloomberg. Co-sponsored by the Japan Studies Program, China Studies Program, and East Asia Center.

Workshop in Seattle: International Law and Regulatory Change: New Models for Japan and China

JANUARY 16, 2009

Friday, 9:00a.m.-4:30 pm

William H. Gates Hall, Room 115

Saadia Pekkanen, Joseph Rawert, Veronica Taylor, Jane Winn, Dongsheng Zang, University of Washington Ichiro Araki, Yokohama National University Henry Gao, Associate Professor, School of Law, Singapore Management University Amelia Porges, Sidley Austin LLP

International Law and Regulatory Change: New Models for Japan and China

This public workshop brings together Japan and China specialists to assess the role of international law and regulatory change in shaping the continuing economic transformation of these two Asian countries. The workshop focuses on the following set of interrelated questions across four different papers: What specific steps have these two countries taken to configure the institutional, legal, and regulatory makeup of their economic realities? In which areas, and to what degree, is their influence evident? What are the main causes and major consequences of their actions for the advance of the legal and regulatory framework in the Asian region as a whole? The discussants for this workshop will include two leading international trade law specialists from China and Japan. As one of the goals of this workshop is to begin to focus on Asia as part of a global legal community, the workshop themes will also be discussed by a leading international economic law specialist who can place the developments in the larger context of legal processes. Presented by the Asian Law Center, School of Law.  External co-sponsor: The American Society of Law's International Economic Law Interest Group. UW co-sponsors: Japan Studies Program, China Studies Program, and the Job and Gertrud Tamaki Professorship.

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Lamy to lead the WTO for the next 4 years

It's been reported that Lamy is so far the only candidate for the WTO DG position and therefore will probably be automatically elected to serve a 2nd term as the WTO DG. How time has changed! Ten years ago, the heated DG-race between Supachai and Moore almost tore the organization apart. Also, when Lamy himself ran for the position in 2005, there was some strong competition from Foreign Minister Jaya Krishna Cuttaree of Mauritius. In my view, it's probably better to have Lamy serve another 4-year term in the interest of the consistency of the leadership in the WTO.