TRADE disputes are escalating not only between China and the United States but also between China and the European Union, as the EU announced in a preliminary ruling yesterday that it would impose an anti-dumping tariff of up to 20.6 percent on its imports of aluminum alloy wheels from China.
It said the Chinese wheel products were sold at an unfairly low price in Europe and as a result sales of relevant EU manufacturers nosedived and caused a price war.
Aluminum alloy wheels tend to be lighter in weight than normal steel wheels and help improve the steering and speed of a car. They are also more expensive to produce.
Chinese aluminum alloy wheel hub products have been widely used by global auto makers, including BMW AG, Daimler AG's Mercedez-Benz, Audi AG and Volkswagen AG.
China's Ministry of Commerce did not respond immediately yesterday but it has constantly called for prevention of trade protectionism in markets like the US and the EU.
The latest case came after the EU decided in December to extend tariffs on Chinese and Vietnamese leather shoes by 15 months to protect European shoe makers. The EU also said that it would begin an anti-subsidy investigation into its imports of coated paper from China in April.
Last Friday, the EU submitted a request to the World Trade Organization hoping to use the trade body's dispute settlement mechanism to help to solve trade rows over anti-dumping duties China imposed on carbon steel fasteners from the EU.
China, meanwhile, demanded the establishment of an expert panel under the WTO to evaluate the EU's shoe tariffs and the country also announced a review of the anti-dumping duties it imposed in 2007 on imports of potato starch from the EU - a move which may lead to an increase in the tariffs.
Trade disputes have the potential to become a major hurdle to a solid global economic recovery, given the growing protectionism around the world, analysts said.
China suffered 19 trade remedy probes in the first quarter, up 93 percent over the same period last year, and involving US$1.19 billion.
Trade rows between the US and China are also on the rise, spreading from tires, paper, steel to chicken products, pipes and tubes.