U.S. Seeks WTO Probe on China Wind Power Funding

The U.S. has requested talks witht he World Trade Organization to explore ways to end Chinese government subsidies to its clean technology sector. From the Wall Street Journal:

The decision comes after the United Steelworkers made a wide range of claims about how China provides unfair support to its clean technology sector. After an investigation into those allegations, the U.S. has decided to only target a modest, narrowly focused program.

U.S. Trade Representative Ron Kirk said the government will continue to look into other claims made by the steelworkers union and could still take action. Any WTO litigation, however, would have to be done outside of the process initiated by the United Steelworkers in September.

The wind power manufacturing grants are being targeted because they appear to be contingent on Chinese producers using parts made domestically, according to the U.S. The size of each grant ranges from $6.7 million to $22.5 million.

“Import substitution subsidies are particularly harmful and inherently trade distorting, which is why they are expressly prohibited under WTO rules,” Mr. Kirk said in a statement. “These subsidies effectively operate as a barrier to U.S. exports to China.”

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