The Strategist

US introduces special anti-dumping measures

01/24/2018 - 13:32

The administration of Donald Trump for the first time applied special protective trade measures that should help local producers deal with the growing pressure of imports. To do this, the country sharply raised tariffs for the supply of solar panels and washing machines. The duties for solar panels were increased to 30%; as for washing machines, the first 1.2 million will be levied 20% and others will be imported under the 50% duty. The limitation will be in force during three years for washing machines, and during four - for PV panels. Unlike anti-dumping and countervailing measures for deliveries from specific countries, new duties will apply to all deliveries. The last time the United States initiated such drastic measures in 2002 regarding the import of steel. Now the administration points out that the study of the trade commission revealed "significant losses of American producers from imports."

Gage Skidmore
Gage Skidmore
Although the measures are not directed particularly against the PRC, however, China is the largest producer of both goods. In total, the US uses the antidumping measures against 111 Chinese products (by comparison: China does it for 19 US goods). In 2016, the import of washing machines from the PRC in the US was estimated at $ 0.4 billion, PV panels - $ 1.5 billion. Together, it amounts to 0.6% of Chinese exports. In the same year, according to the International Trade Center, the volume of imports to the US from China was $ 481.5 billion, down 4.5% year-on-year. However, as the situation in the US economy improves, imports and trade deficit are expected to increase. Now the US accounts for almost a quarter of all Chinese exports and vice versa, China's share in US imports is also comparable - about 22%.

As expected, China will try to challenge the new restrictions in the WTO. Authorities of South Korea and Germany have already expressed dissatisfaction, pointing out the risks of the "trade war". The macroeconomic effect of these measures will not be so significant due to the volume of the industries themselves, Capital Economics believes, noting that such a policy may be the result of some disappointment in the application of anti-dumping measures. Chinese manufacturers have learned to bypass them by transferring the final assembly to third countries. So, after US anti-dumping measures for the supply of solar panels from China in 2012, the share of PRC in supply fell from 59% to 34%, but rose from 13% to 30 % in Malaysia.