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WTO rules against China in raw materials case

A WTO panel ruled that Chinese restrictions on a number of raw materials exports used in the steel and chemical industries violate global trade rules, a victory for the US, EU and Mexican trade negotiators that had brought the complaint, The Wall Street Journal reported. China had promised to scrap the export limits after joining the WTO in 2001, but it later reversed that decision, citing environmental concerns. The US, later joined by the EU and Mexico, alleged that China was limiting exports to give domestic producers a cost advantage. The WTO appeals panel ruled Monday that while restrictions are indeed permissible for environmental reasons, China had not demonstrated that it also limited their use in domestic production or consumption. “Today’s decision ensures that core manufacturing industries in this country can get the material they need to produce and compete on a level playing field,” said Ron Kirk, US trade representative. The ruling has raised speculation that the US and EU might push a WTO case against China’s export restrictions on rare earth materials.

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