Japan, US, EU Propose WTO Subsidy Rules: Jiji

January 16, 2020
China as the target? Japan, the European Union and the United State propose new WTO rules to limit subsidies

Read the article from Jiji Press about proposals for the WTO to restrict industrial subsidies.

Read about subsidies and countervailing measures from the WTO: “The WTO Agreement on Subsidies and Countervailing Measures disciplines the use of subsidies, and it regulates the actions countries can take to counter the effects of subsidies. Under the agreement, a country can use the WTO’s dispute-settlement procedure to seek the withdrawal of the subsidy or the removal of its adverse effects. Or the country can launch its own investigation and ultimately charge extra duty (“countervailing duty”) on subsidized imports that are found to be hurting domestic producers.”

- Associated with strategic industries - Encourage expansion - Contribute to over-production - Decrease production costs - Reduces efficiency - Misallocates production across countries - No gains for consumers - Difficult to detect and measure, or prove injury - Focus on export sales and unrelated to domestic need

(Source: Microeconomic Insights)

Read an article from Vox about phase one of a US-China trade deal.

China - purchase $200 billion of goods, concessions on intellectual property, currency, access to financial services. US - cancel and reduce some tariffs; maintain tariffs on $360 billion of Chinese goods. No steps on subsidies US -

(Source: Vox)

Jiji Press
External link: 
https://jen.jiji.com/jc/eng?g=eco&k=2020011500349