China’s Ministry of Commerce has denied allegations raised by the United States that it unfairly subsidized companies as prohibited under World Trade Organization (WTO) agreements.
Responding yesterday to comments made by the Obama administration on Wednesday, the ministry defended Chinese policies aimed at providing assistance to exporters’ administrators across seven economic sectors, including textiles, apparel and footwear. A statement on its website said China consistently follows WTO rules and that the purpose of its policies is to “transform [the country’s] foreign trade and promote its sound and stable development.”
U.S. Trade Representative Michael Froman said the program, called “Demonstration Bases-Common Service Platform,” gives Chinese companies an unfair advantage by providing free and discounted services as well as cash grants and other incentives to manufacturers and producers in more than 150 industrial clusters. Froman claims this harms American workers and business initiatives.
The Chinese ministry said it will settle the issue according to WTO dispute procedures.