WTO says US tariffs on Chinese goods violate international trade rules

US President Donald Trump and Chinese Vice Premier Liu He, the country’s top trade negotiator, hold a press conference ahead of signing a trade deal with the US and China during a ceremony in the East Room from the White House in Washington, DC on January 15, 2020.

Saul Loeb | AFP | Getty Images

NEW YORK – The World Trade Organization ruled on Tuesday that additional tariffs imposed in 2018 by the United States on Chinese goods violated international trade rules, a blow to the Trump administration’s trade war against the world’s second largest economy.

A panel of three WTO trade experts said Washington breached global regulations in 2018 by imposing more than $200 billion in levies on a host of Chinese products. Since March 2018, the United States has imposed tariffs on $400 billion of Chinese exports.

“The United States has failed to meet its obligation to demonstrate that the measures are provisionally justified,” the panel said in a report. The panel made an additional observation, saying the group was “highly aware of the broader context in which the WTO system currently operates, which reflects an unprecedented range of global trade tensions.”

The Chinese Embassy in Washington did not immediately respond to CNBC’s request for comment.

“The multilateral trading system with the WTO at its center is the cornerstone of international trade,” a spokesperson for China’s Ministry of Commerce told reporters at a press conference.

“China has always firmly supported and upheld this cornerstone and abided by the rules and rulings of the WTO,” the spokesperson said, adding that Beijing “hopes the United States will fully respect the rulings of the expert panel. and the rules-based multilateral trading system, will take practical actions to meet with China and other WTO members, jointly uphold the multilateral trading system, and promote the stable and healthy development of the world economy.”

The Trump administration has previously claimed that the tariffs on China were necessary to combat unfair trade practices and intellectual property theft from Beijing. The US Trade Representative reiterated those claims on Tuesday in the wake of the WTO ruling.

“This panel report confirms what the Trump administration has been saying for four years: the WTO is woefully inadequate to stop China’s harmful technology practices,” US Trade Ambassador Robert Lighthizer said in a statement. . “The United States must be allowed to defend itself against unfair trade practices, and the Trump administration will not let China use the WTO to take advantage of American workers, businesses, farmers and ranchers.”

In total, Washington has 60 days to appeal the decision under WTO rules. This decision could prompt Beijing to ask the organization to rule, which could take several years.

Nearly a year ago, in an address to the United Nations General Assembly in New York, President Donald Trump said the Geneva-based WTO needed “radical change” to counter the cheating of China and other countries.

“For years, these abuses have been tolerated, ignored, or even encouraged,” Trump said in September 2019. He also said the United States would not accept a “bad deal” in trade talks with China and that he didn’t need a deal before the 2020 election.

“I hope we can come to an agreement that will benefit both countries. But as I have made very clear, I will not accept a bad deal for the American people,” Trump said, eliciting no criticism. reaction of the Chinese delegation.