October 05, 2010

Gillibrand Urges Feds To Investigate China’s Unfair Green Technology Trade Practices

Petition Accuses China Of Providing Hundreds Of Billions Of Dollars In Illegal Subsidies And Support To Local Firms, Violating WTO

Washington, DC – Earlier this month, the United Steelworkers (USW) filed a petition to the U.S. Trade Representative (USTR) asserting that China has provided more than $200 billion in subsidies and support to their local firms in violation of their World Trade Organization (WTO) agreements. U.S. Senator Kirsten Gillibrand today urged President Obama to take immediate and aggressive action against the practices cited in the petition. She has also called on the USTR to investigate alleged practices by the Chinese government that protect Chinese producers of renewable and alternative energy products – including wind turbines, solar panels, next generation batteries and energy efficient vehicles. 

Given the enormous economic potential of clean energy technology and manufacturing, Senator Gillibrand believes it is essential that the USTR investigate these practices and not allow China to grant its producers an unfair upper hand.  Senator Gillibrand also requested a meeting with the Chinese Ambassador to discuss these accusations and the importance of fair and open access to international markets.

“We must make sure that American’s renewable energy producers and manufacturers are on a level playing field with their Chinese counterparts,” said Senator Gillibrand. “New York is poised to seize tremendous economic opportunity in the renewable energy sector. However, we must ensure that American manufacturers and innovators are on a level playing field.  We cannot allow other countries to corner the market through unfair and illegal trade practices. I hope that the USTR will launch a thorough investigation into these practices and that the Administration takes strong action to enforce our trade agreements.”

“It is critical that we safe guard our economic ‘green’ opportunities in the state of New York and the rest of the nation,” said State Senator Antoine Thompson. “So, I support Senator Gillibrand’s call for a discussion about China's trade practices to make sure that international trade is always conducted fairly.”

China has been accused by many observers of providing export subsidies for Chinese alternative energy firms and placing export restrictions on key components and resources needed by companies around the globe to develop green technologies.

America’s trade balance has shifted from a surplus in high-tech goods during the 1990s to a deficit of over $135 billion today. Currently, more than 70 percent of the components of clean energy systems are produced outside the U.S. China spends $51 million a day on clean energy manufacturing, using unfair subsidies and discriminatory tactics.

The USW petition lists a number of steps China has taken a number of steps that have the effect of unfairly damaging U.S. producers of clean energy technologies in favor of their Chinese counterparts.  Many of these actions appear to be violations of China’s accession agreements to the WTO and WTO membership rules. The petition allegations include that China is illegally blocking foreign access to green energy materials of production, providing subsidies for Chinese exports, reducing clean energy imports, and demanding foreign investors hand over trade secrets. 

For example, China effectively requires foreign firms seeking to engage in joint investment ventures in China to transfer technology to their domestic partners. This potentially undermines years of American investments in research into clean energy technology and makes America less competitive.  Additionally, recent news reports have identified additional subsidies and benefits granted to Chinese exporters of green products, from exceptionally low interest loans to access to low-cost land in prime areas.