U.S. Challenges to China’s Farm Policies
July 27, 2020
Anita Regmi
In early 2019, the World Trade Organization (WTO) ruled in favor of the United States in two cases that the U.S. Office of the Trade Representative (USTR) filed against China, alleging that its agricultural policies were inconsistent with its WTO obligations. While China agreed to conform to the WTO rulings, USTR contends that Beijing failed to act on one of the cases by the agreed-upon deadline of June 30, 2020. On July 16, 2020, USTR submitted a notification to the WTO requesting authorization to take countermeasures against imports from China.
China’s Farm Support Spending
In the first case (DS511), USTR contended that China’s support policies to growers of wheat, rice, and corn exceeded the spending limits it agreed to in 2001, when it joined the WTO, by nearly $100 million from 2012 through 2015. USTR asserted that these policies created an incentive for Chinese farmers to increase production of the subsidized crops, displacing imports and distorting international trade.
On February 28, 2019, the WTO dispute settlement body agreed with major parts of the U.S. complaint, finding that China had exceeded its domestic support limits for wheat and rice in each year between 2012 and 2015. The WTO body also disagreed with China’s methodology for calculating the amount of domestic support its wheat and rice farmers received. It recommended changes to bring the Chinese policies into compliance with China’s WTO commitments. It did not make a ruling on corn because, following the 2015 harvest, China made changes to its calculations of corn support prices, making them less market distorting.
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미국
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