Saturday, 20 December 2008

From textiles to peanuts

On Friday, the USTR filed another WTO case against China concerning China's "Famous Brands" programs. According to the Consultation Request, the Chinese programs allegedly violate the SCM Agreement, the Ag Agreement, and the NT obligation under GATT Art. III.

In the press release, USTR Susan Schwab announced that the reason to take this case was because "
we were disturbed to find that China still appears to be using WTO-illegal measures to promote its exports, ranging from textiles and refrigerators to beer and peanuts. We are going to the WTO today because we are determined to use all resources available to fight industrial policies that aim to unfairly promote Chinese branded products at the expense of American workers, farmers, ranchers, manufacturers and intellectual property owners". Of course this case is not about peanuts, even though China happens to be the largest exporter on this. The more likely cause is textiles, as US textile firms try to find other ways to fight the onslaught of Chinese exports ahead of the expiration of the Special Textile Safeguard at the end of this year.

Interestingly, Sanlu is also on the 2005 list of "famous brands" in China. Moreover, the website of the China Promotion Committee for Top Brand Strategy even provides detailed instructions on how to distinguish some "famous brands" Chinese dairy products, including milk powder made by Sanlu, from the fake ones. Now it seems the best way might be testing the melamine levels of the products concerned.

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