(Pittsburgh) – The United Steelworkers (USW) released the following statement from International President Leo W. Gerard regarding the announcement by the Office of the United States Trade Representative that the Obama Administration has accepted the USW’s petition under Section 301 of the trade law seeking the elimination of Chinese policies and practices that adversely affect U.S. producers and their workers in the clean energy sector. A description of the petition appears below.
“President Obama showed again today that fighting for U.S. workers and their jobs is his top priority. He’s backed up his commitment to a clean energy future by making it crystal clear that that future is going to benefit all Americans.
“By accepting the petition the Steelworkers filed against China’s predatory and protectionist policies, it sends the message that America is not going to stand by while our jobs get outsourced. China and all of our trading partners need to understand that we want fair trade and that we’re not going to allow unfair and illegal trade practices to deny our farmers, workers and businesses of the opportunity to compete on a level playing field.
“The Administration’s decision today starts an intense process designed to resolve our concerns about China’s vast array of policies and practices that they have assembled to dominate the alternative and renewable energy sector. Our goal, with the acceptance of this petition and the further verification and improvement of the potential cases, is that the Chinese will abandon their continuing effort to steal our jobs and ignore their commitments. Enough is enough: China needs to start playing by the rules they agreed to when they joined the WTO.
“Our nation has gone through the greatest economic crisis since the Great Depression. Today’s decision is further evidence that job creation and economic recovery are the central efforts of President Obama’s Administration and that his promise of a high and rising standard of living for all our people is one he intends to keep.
“Since we filed our petition on September 9, there has been a flood of support from the public and a growing number of elected officials. More than 185 Members of the House and 44 Senators have voiced their support for our case by signing letters urging acceptance of the petition. While a small handful of Republicans joined in supporting this effort, the overwhelming majority of support in the House and every signatory in the Senate were Democrats. Fighting for those who work hard and play by the rules shouldn’t be a partisan issue, but most Republicans appear to disagree.
“Today’s decision gets us to the starting gate, it doesn’t end the process. There will be a need for political leaders to stand with the President and make clear that Americans are united in this effort. As the election approaches, voters should ask every candidate whether they support a trade policy that creates jobs and wealth here at home or one that ignores China’s unfair and illegal practices.
“In the coming days, the Steelworkers look forward to working with the President, Ambassador Kirk and his able staff to ensure a successful outcome to this case. Our original petition spanned more than 5,800 pages. These are complex issues and addressing them requires significant effort. We stand ready to support them as they work to successfully resolve these critical issues.”
As is required by the underlying 301 statute, the Office of the USTR appropriately consulted with the Steelworkers on the question of delaying the start of consultations by up to 90 days “for the purpose of verifying or improving the petition to ensure an adequate basis for consultation”. This delay has been utilized in other 301 actions in the past.
The 301 petition was filed on September 9, 2010 and addressed five specific areas:
- Restrictions on access to critical materials: Many green technologies depend on critical rare earth elements and other minerals, and China produces 90 percent of the world’s supply of these essential inputs. China denies U.S. producers free access to these inputs (and gives its own producers privileged access to them) through a combination of export quotas, export taxes, and export licenses that violate WTO rules.
- Performance requirements for investors: The Chinese government has the power to approve or disapprove of foreign investment agreements in its territory; in practice, joint venture agreements in the green technology sector routinely require U.S. investors to license key technologies to their Chinese counterparts. Such requirements, if imposed as a condition of investment approval, violate China’s WTO commitments.
- Discrimination against foreign firms and goods: China requires that the level of domestic content be considered in approving wind farm concessions, and reportedly required it’s first approved solar power plant to use 80 percent Chinese goods. These and other discriminatory requirements violate WTO rules.
- Prohibited export subsidies and prohibited domestic content subsidies: China requires recipients of certain green technology subsidies to use Chinese over imported components or to export a minimum level of production, contrary to WTO rules. In addition, China outspends the U.S. by 5 to 1 in export credits and insurance, and refuses to conform these subsidies for green technology exports to WTO rules.
- Trade distorting domestic subsidies: China’s massive subsidies for domestic producers of green technology have propelled its producers over U.S. firms, shut the U.S. out of China’s wind market, seized market share from the U.S. in Europe’s wind and solar markets, driven down world prices, and caused lost sales in the U.S. market. The harm these subsidies are causing makes them actionable at the WTO.
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