WTO to condemn China for limiting raw material exports

The World Trade Organization is set to find fault with China for policies limiting exports of major raw materials, the Wall Street Journal reported, citing unnamed trade diplomats and lawyers. The decision, if upheld on appeal, will help steelmakers and other industrial producers outside of China, and will set a precedent for an upcoming case over China’s curbs on the strategically critical rare earths metals, which critics have said are designed to protect China’s emerging cleantech industries. In addition to rare earths, China is the world’s largest producer of cadmium, indium, gold, iron ore, lime, lead, manganese, mercury, molybdenum, phosphate, tin, tungsten and zinc. Since the global financial crisis struck, Beijing has steadily reduced exports of all these minerals. Exports of phosphorus, for example, fell to 39,665 tons in 2010, down from 102,346 tons in 2005. The US steel industry has accused China of cutting exports of bauxite by 100,000 tons this year. China does not deny cutting exports, but cited the WTO’s article 20, which allows its members to limit exports for environmental reasons, an argument the WTO rejected.