The Obama administration announced that it will place a duty o 35% on Chinese tires. This is is on top of the existing 4% tariff. This is an issue that has been brewing since the Spring when the US International Trade Commission ruled that a tariff was necessary. The Chines have 16.7 market share in tires up from 4.7 in 2004.
China has now accused the US of "rampant protectionism" for imposing heavy duties on the tires and has threatened action against imports of US poultry parts and auto parts. China estimates that the impact will be a loss of 100,000 jobs and $1 billion. The Chinese note that tire export growth to the US was up 2.2 in 2008 and down 16% in 2009.
This will give the leaders of the G20 something to talk about in Pittsburgh on Sept 24-25. This is after the G20 agreed that every effort should be made to ensure that protectionism does not take hold around the world.
I am surprised that there has not been more reaction to this information. Perhaps it is because it occurred on Friday afternoon but this could be the spark to a protectionist fire. Watch this closely.
China has now accused the US of "rampant protectionism" for imposing heavy duties on the tires and has threatened action against imports of US poultry parts and auto parts. China estimates that the impact will be a loss of 100,000 jobs and $1 billion. The Chinese note that tire export growth to the US was up 2.2 in 2008 and down 16% in 2009.
This will give the leaders of the G20 something to talk about in Pittsburgh on Sept 24-25. This is after the G20 agreed that every effort should be made to ensure that protectionism does not take hold around the world.
I am surprised that there has not been more reaction to this information. Perhaps it is because it occurred on Friday afternoon but this could be the spark to a protectionist fire. Watch this closely.
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