Chinese Mineral Export Restrictions Violate International Rules, WTO Appellate Body Says
Brian Flood, Bloomberg BNA
China’s export restrictions on tungsten, molybdenum and rare earths—key inputs in a range of high-tech products—violate international trade rules, a World Trade Organization appellate body affirmed Aug. 7.
While it differed on a few legal points, the appellate body largely upheld a March 26 ruling by a WTO dispute settlement panel that the Chinese restrictions, which take the form of export quotas, export duties and other measures, run counter to commitments China made when it joined the WTO in 2001.
Some observers, however, said the ruling won’t address the problem of a huge imbalance in the global rare earths trade. Jeffery Green, president of the government relations firm J.A. Green & Co., told BNA in a phone interview that while the U.S. government is pointing to the appellate body’s decision as a major victory, it will do little to spur the U.S.’s own production of rare earths. Rather, Green said, the primary benefit will be to stabilize prices for manufacturers who use rare earths, most of whom are located in China anyway.
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