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Wednesday, 27 March, 2002, 11:14 GMT
Taiwan denies China steel charge
Like the US, Europe fears cheap steel imports
Taiwan's biggest steel producer has hotly denied allegations by the People's Republic of China that it is dumping cold-rolled steel at artificially cheap prices on the mainland market.

Beijing is concerned that with the US slapping tariffs of up to 30% on steel to protect its own underperforming firms, other countries could flood its market as they look for new outlets.

Cross strait exchanges, contacts and negotiations on economic issues are the domestic affairs of one country... There is no need to deal with them under a multilateral frame such as the WTO

Li Weiyi
Taiwan Affairs Office, Chinese State Council
Russia, South Korea, Ukraine and Kazakhstan are also under suspicion.

The worry is that the US's decision to ditch its free-trade rhetoric and protect its own back yard will trigger new tariff walls elsewhere.

Europe is already asking the WTO for permission to impose its own "safeguards", in the fear that steel barred from entering the US market will be redirected across the Atlantic.

Dire straits

Both China and Taiwan are appealing to the World Trade Organisation to try to get the US actions blocked.

And Taiwan - 50% of whose exports go to the mainland - is quite ready to put its argument with China to the WTO.

But if China has its way, its own dispute with Taiwan will go nowhere near the organisation's Geneva headquarters.

In China's eyes, after all, Taiwan is a "breakaway province" lurking just across a narrow strait, not an independent country.

"Cross strait exchanges, contacts and negotiations on economic issues are the domestic affairs of one country," said Li Weiyi, spokesman for the Taiwan Affairs Office of the Chinese State Council.

"There is no need to deal with them under a multilateral frame such as the WTO."

Different but alike

To be fair, ever since nationalist refugees from the civil war with Mao Zedong's Communists landed there in 1948, Taiwan's government has officially agreed that China is indivisible.

It simply does not recognise that the Beijing regime is the legitimate ruler.

China's insistence that no-one else should pay even lip service to the idea of Taiwanese independence means that the island's WTO membership is in the name of the "Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu".

Taiwan, of course, shares the worries about dumping.

With its own tariffs due to fall to zero by 2004, it fears it is going to become a dumping target in its own right as its steel sector recovers from a poor performance last year.

See also:

26 Mar 02 | Business
EU poised to retaliate on steel
25 Mar 02 | Business
China responds to US steel tariffs
22 Mar 02 | Business
EU drafts steel war retaliation
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