Beijing decided on Monday to remove export tariffs on 81 lines of products after US and EU reimposed quotas on apparel imports from China. Export tariffs will still be applied on 68 other lines but they will not be raised from June 1, the Ministry of Commerce announced.
As a clear sign that a trade war is looming between China on one side, the United States and the European Union on the other side, Beijing Monday decided to scrap export tariffs on no less than 81 products.
Tariffs will be maintained on 68 other lines of products but they will not be substantially raised.
China had imposed export tariffs to curb exports in a quota-free world, effective from January 1.
A few days ago, Beijing announced that export tariffs would be substantially increased, effective from June 1.
The sharp rise was not expected affecting the current boom in shipments to the US and the EU, however.
In China by contrast, already low margins of apparel exporters would have been further eroded.
The strong reaction within China to last week's announcement led to Monday's decision to finally remove tariffs or to leave them unchanged, depending on products (see links to the lists of categories below).
Beijing is also protesting against US and EU official requests for consultations over imports from China, therefore triggering quota periods.
The decision to remove export tariffs is a first sign that China could finally ask WTO's Dispute Settlement Body to set a panel in order to get rules against Washington and Brussels.
Beijing would therefore be allowed imposing retaliatory tariffs on imports from the US and the EU, especially on products not related to textile and apparel sectors.
EU and US trade officials will continue negotiating with Chinese counterparts in the coming days.
"We are still willing to discuss, to negotiate, to a mutually satisfactory settlement," said a spokeswoman for EU Commission.
US Commerce Secretary Carlos Gutierrez will arrive in China in the current week to discuss trade issues, including textiles.
Gutierrez already said that the just reimposed new quotas would not be removed.
Other limits could be set on US and EU imports from China in the coming weeks and discussions will probably go on until additional quotas are officially announced.
