Congressman Dan Lipinski (IL-3) is leading a bipartisan group of lawmakers in urging President-elect Trump to prevent China from being granted “market economy status” (MES); this status would make it easier for China to cheat American companies and steal American jobs.  When China joined the World Trade Organization (WTO) in 2001, a provision was put in place labeling China as a non-market economy (NME) which allows the United States to implement significant anti-dumping duties to protect American companies and workers from unfair Chinese trading practices.  China believes this provision should expire.

“Given continued mercantilist activities, including subsidization, industrial planning, currency misalignment policies, overcapacity, and state-owned enterprises, we believe that the United States must continue the longstanding policy of treating China as a NME, as WTO rules allow,” said Rep. Lipinski and several of his colleagues in a letter to the President-elect.  “Granting China MES would undermine the effectiveness of our trade enforcement policies used to combat unfairly priced Chinese imports.  It is vital that these policies continue to prevent domestic producers from being driven out of business and workers from being laid off due to continued Chinese central planning and non-market policies.”

Under WTO rules, a NME is appropriately treated differently for the purposes of calculating antidumping duties.  However, China is alleging that it should automatically attain market economy status based on its interpretation of Article 15 of its Protocol of Accession to the WTO, and has requested consultations with the United States to force the United States and other nations to treat China as a market economy.

“We strongly urge the President-elect to continue and reaffirm the U.S. policy of continuing to treat China as a NME, which is appropriate given WTO rules, the facts, and the underlying U.S. statutory test,” stated the bipartisan group of lawmakers in the letter.  “This is not a political question, but a substantive one.  Ensuring that facts determine the outcome will incentivize China to abandon market-distorting policies while protecting businesses and jobs here in the United States.”