'Made in China' label for HK goods: WTO to arbitrate on new US rule

GENEVA • The World Trade Organisation (WTO) has agreed to establish a dispute resolution panel on the new US rule that all goods imported from Hong Kong must be stamped "Made in China".

The WTO's Dispute Settlement Body on Monday accepted a second request from Hong Kong to establish a panel "to rule on US origin-marking requirements for goods", said a Geneva trade official.

Hong Kong made a first request for arbitration at the Geneva-based global trade body on Jan 25, but the move was blocked by the United States.

Under WTO rules, a second request is, in practice, automatically accepted. However, a resolution is far from near, as the settlement of trade disputes at the WTO usually takes years.

In July last year, then US President Donald Trump announced the end of the preferential conditions granted by Washington to Hong Kong, after the imposition by Beijing of a sweeping new national security law on the semi-autonomous territory.

A month later, US customs announced that goods imported from Hong Kong would have to be stamped "Made in China" rather than "Made in Hong Kong".

The new rules came into effect in November.

Hong Kong said the measures were inconsistent with a raft of WTO regulations including the rules of origin agreement and the technical barriers to trade agreement.

The territory described the requirements as "arbitrary, unilateral, unnecessary and unjustifiable", said the trade official.

The US delegation to the WTO, in a statement on Monday obtained by Bloomberg, backed the Trump administration's decision to label Hong Kong exports as "Made in China" and said the WTO had no right to mediate the matter because the organisation's rules permit countries to take any action to protect their "essential security interests".

Mr Wang Yi, a Chinese state councillor and Foreign Minister, said on Monday the US and China could work together on various issues, if they repaired their damaged bilateral relations, but Washington accused Beijing of trying to avert blame for its actions.

Mr Wang urged Washington to respect China's core interests, stop "smearing" the ruling Communist Party, stop interfering in Beijing's internal affairs and stop "conniving" with separatist forces for Taiwan's independence.

He also called on the US to remove tariffs on Chinese goods and abandon what he said was an irrational suppression of the Chinese tech sector.

In response, State Department spokesman Ned Price told reporters: "His comments reflect a continued pattern of Beijing's tendency to avert blame for its predatory economic practices, its lack of transparency, its failure to honour its international agreements and its repression of universal human rights."

US House Speaker Nancy Pelosi, in a statement on China's crackdown on Hong Kong, on Monday urged considering strict consequences for Beijing. She said: "The Chinese government must know that the world is watching its strangulation of human rights - and that we must put all options on the table for holding China accountable."

AGENCE FRANCE-PRESSE, BLOOMBERG, REUTERS

A version of this article appeared in the print edition of The Straits Times on February 24, 2021, with the headline ''Made in China' label for HK goods: WTO to arbitrate on new US rule'. Subscribe