On Wednesday, April 17, the Office of the United States Trade Representative (USTR) announced the initiation of a Section 301 investigation into Beijing’s maritime, logistics, and shipbuilding industries, prompting a late-night response from the Chinese government.
The investigation was triggered by a complaint filed on March 12 by the United Steelworkers (USW) and four other major labor unions, urging the Biden administration to probe into what they described as “unreasonable and discriminatory” behaviors, policies, and practices of Beijing in the maritime, logistics, and shipbuilding sectors.
After reviewing the complaint and hearing recommendations from the Section 301 Committee, the USTR decided to proceed with the investigation.
In a statement issued by Trade Representative Dai Qi on Wednesday, she stated, “These complaints make serious and concerning allegations, stating that the People’s Republic of China (PRC) has long sought to dominate the maritime, logistics, and shipbuilding industries, listing unfair and non-market policies and practices employed by the PRC to achieve these goals. These allegations mirror what we have seen in other areas, where the PRC uses broad non-market policies and practices to undermine fair competition and dominate markets in China and around the world.”
Dai Qi assured, “I pledge to conduct a comprehensive and thorough investigation into the issues raised by these unions.”
The USTR will seek public input on the matter and hold public hearings as part of the investigation.
The five labor union organizations that called for the Section 301 investigation into China are the United Steelworkers (USW), International Association of Machinists and Aerospace Workers (IAM), International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers, and Helpers (IBB), International Brotherhood of Electrical Workers (IBEW), and Maritime Trades Department (MTD) of the AFL-CIO.
Under the Trade Act of 1974, the Section 301 provision grants the U.S. President the authority to take appropriate measures, including tariff and non-tariff actions, to address other countries’ violations of international trade agreements or their unfair, unreasonable, and discriminatory practices against U.S. commerce. The USTR can launch a Section 301 investigation and, based on the findings, recommend punitive measures such as revoking trade preferences and imposing tariffs.
In response to the U.S.’s initiation of a new round of Section 301 investigation, the Chinese Ministry of Commerce issued a press release late Wednesday expressing strong dissatisfaction and firm opposition.
A spokesperson for the Chinese Ministry of Commerce stated that the U.S.’s decision to launch a new Section 301 investigation for domestic political needs was “wrong once again.” China indicated that it will closely monitor the progress of the investigation and take necessary countermeasures.
On Wednesday, U.S. President Biden announced his intention to triple tariffs on steel and aluminum exports from China citing “unfair competition.” However, Biden denied labeling the actions as a new “trade war” between Washington, D.C. and Beijing.
The last time the U.S. conducted a Section 301 investigation against Beijing was during the Trump administration in 2018, which led to the U.S.-China trade war, where both sides imposed tariffs on each other. Ultimately, negotiations resulted in the U.S.-China Phase One trade agreement, with Beijing making concessions and committing to increasing purchases of American goods.
Editor: Lin Yan#