WTO Rules Against China on Minerals

July 6th, 2011
in econ_news

China mining Econintersect:  The WTO (World Trade Organization) has ruled against China in a case lodged by the United States, the European Union, and Mexico in 2009.  The ruling found that China violated international law by restricting exports of nine raw materials used in the manufacturing of high-technology products.  According to the Shanghai Daily, China said it regretted the decision made by the World Trade Organization yesterday (July 5) which covered Chinese curbs on exports of coveted raw materials, such as coke, zinc and bauxite.

Follow up:

China had argued that it had controlled the extraction of mineralt resources in a way that protected the environement and assured sustainability.  From the Shanghai Daily:

China said it regretted the WTO's decision, insisting its export policies are based on environmental and resource protection -- a justification likely to resonate with nations such as Russia, Ukraine and India that are also reining in their resource sales. China is expected to appeal the ruling.

"China takes the view that although these measures have a certain impact on domestic and international users, they are in line with the objective of sustainable development promoted by the WTO and they help to induce the resource industry toward healthy development," the Chinese government said in a statement from its embassy in Geneva, where the WTO is based.

The WTO ruling is believed to strengthen charges regarding Chinese exports of rare-earths.  From The Boston Globe:

Significantly, the ruling strengthens other European arguments against Chinese restrictions on another category of exports - rare earths, 17 minerals also used in the high-tech industry.

The case also demonstrates how dependent technology industries have become on some exports from China.

Sources:  Shanghai Daily and The Boston Globe

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