WTO to China: Put the brakes on
Having the second-largest car market in the world, China has also been charging higher tariffs on imports of car parts from abroad. The World Trade Organization has condemned this as protectionist. Stephen Beard reports.
Milling over a car engine (iStockPhoto.com)
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Doug Krizner: China has suffered its first defeat at the World Trade Organization. We have more from Stephen Beard.
Stephen Beard: The dispute with China is over auto-parts -- like batteries, brakes and spark plugs. China's been charging higher tariffs on imports of these goods from the U.S., Canada and the E.U.
In effect, the Chinese have favored car component makers based in their own country. In an interim ruling, the World Trade Organization has condemned this as protectionist.
Gareth Leather, of the Economist Intelligence Unit, says this decision could be a breakthrough for Western car makers:
Gareth Leather: China's now the second-largest car market in the world after the U.S. So obviously, car makers from around the world are trying to enter this market. And this ruling, depending on what happens, should allow them easier access to China
But WTO disputes tend to rumble on for years. China is thought likely to appeal the ruling. It still could be some time before the Chinese are forced to open up their car market to global competition.
In London, this is Stephen Beard for Marketplace.
