China-Autos: Haven't We Danced this Dance Before?

Abstract

Just as it had in several recent similar disputes, the Panel in China – Autos found several of the challenged issues WTO inconsistent. We believe virtually all of the deficiencies noted by the Panel could be easily addressed with minor changes to MOFCOM practices. The real significance of this dispute lies in what it tell us about the larger trade policy dance between the US and China. On the one hand, with the series of related WTO disputes the US has demonstrated that China must comply with WTO rules. The more vexing challenge, however, is the apparent tit-for-tat motivation for this and other recent Chinese trade policies, and on this point this dispute does little to change the calculus. The prospective nature of WTO relief makes it almost impossible for the WTO to discourage the type of opportunistic protectionist actions exemplified by this case.

Keywords: MOFCOM, essential facts, price effects, tit-for-tat protection.