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President Bush rules in favor of Chinese steel shirt hangers, rejects ITC. (Washington Alert).

President George W. Bush announced in April that he has determined not to provide 'relief" against steel wire hanger imports from China. Under a safeguard clause, agreed to by China when it acceded to the World Trade Organization (WTO) in December 2001, the U.S. can impose quotas on individual Chinese imports if it finds that the imports caused "significant market disruption" for U.S. manufacturers.

In this case, the second under the safeguard, Bush rejected the finding of the U.S. International Trade Commission (ITC) that imports of Chinese steel wire hangars had indeed caused "significant market disruption." The ITC had voted on remedies to offset the market disruptions and recommended an additional import tariff of 30% to the President.

In rejecting the ITC findings, Bush found that imposing tariffs under the safeguard would "likely have a negative effect on the thousands of small, family-owned dry-cleaning businesses across the U.S. that would either have to absorb the resulting increased costs or pass them on to their customers."

According to the president, "After 6 years of competing with Chinese imports, domestic producers still account for more than 85% of the U.S. wire hanger market. With this dominant share of the market, domestic producers have the opportunity to adjust to competition from Chinese imports even without import relief. Furthermore, there is a strong possibility that if additional tariffs on Chinese wire hangers were imposed, production would simply shift to Third World countries, which could not be subject to section 421's China-specific restrictions. In that event, import relief would have little or no benefit for any domestic producer."
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Publication:Modern Casting
Article Type:Brief Article
Geographic Code:9CHIN
Date:Jun 1, 2003
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