Japan Joins US in China WTO Case

♠ Posted by Emmanuel in ,, at 2/18/2007 06:55:00 PM
Japan has joined the US as a third party in the latter's case against Chinese subsidies. The US has asked the EU to join as well, though the EU hasn't yet. At first I was kind of surprised as I assumed that many of the foreign-invested enterprises (FIEs) operating in China with Japanese involvement would be hurt. At least that's what I thought before reviewing Whalley and Xin's recent research paper on FIEs in China. American and Japanese FDI is more horizontal in terms of their production that is sold in China; 80% of American and 45% of Japanese production there is destined for the local market. In contrast, FDI from Hong Kong, Taiwan, and South Korea is more vertical and geared towards production destined for overseas markets.

I have written more about this case on Roubini Global Economics Monitor. Here too is a link to the WTO dispute settlement consultation filing (DS 358). Why the WTO provides documents in Word and not PDF format is a mystery to me.