There has been a spate of trade tiffs over the past few months, but relations appeared to be on the mend after a high-level meeting between trade officials at the Chinese city of Hangzhou. Now, as President Obama prepares to make his first official trip to China, tempers are again flaring.
The United States, Europe, and Mexico have asked the World Trade Organization (WTO) to arrange a dispute settlement panel to investigate Chinese restrictions on exports of certain industrial metals. The WTO complaint claims that Chinese restrictions on exports such as bauxite and magnesium are driving up the prices of steel, aluminum, and chemical products.
"China's restrictions on raw materials continue to distort competition and increase global prices, making conditions for our companies even more difficult in this economic climate," said Catherine Ashton, the European Union's (EU) trade commissioner.
Beijing applies an export duty of as high as 15% on some of its materials. However, China's Ministry of Commerce contends that those duties are in place to protect the environment by increasing the cost of extraction. The ministry also disputed Ashton's claim that such taxes are making it harder for Western companies to emerge from the recession.