China announces anti-discrimination probe in response to Canada's tariff hikes

BEIJING, Sept. 3 (Xinhua) -- China on Tuesday announced an anti-discrimination investigation amid a slew of countermeasures against Canada's tariff hikes on electric vehicles (EVs) as well as steel and aluminum products imported from the country.

The anti-discrimination probe into Canada's tariff moves will be initiated in accordance with relevant stipulations of China's foreign trade law, and corresponding measures will be taken subsequently in light of actual conditions, a spokesperson of the Ministry of Commerce (MOC) said in an online statement.

It is learned that this was the first such investigation initiated by China and also the first of its kind in the world.

The Canadian side adopted discriminatory unilateral restrictive measures targeting imports from China, in disregard of opposition from various parties, the spokesperson said, noting that China is "strongly dissatisfied with and firmly against" such moves.

China will file an appeal to the World Trade Organization (WTO) dispute settlement mechanism against these practices, according to the spokesperson. The country will also launch anti-dumping investigations into rapeseed imports and certain chemical products from Canada.

These decisions came after Canada announced last week that it will implement a 100-percent surtax on all Chinese-made EVs, effective Oct. 1, 2024, and impose a 25-percent surtax on imports of steel and aluminum products from China starting Oct. 15, 2024.

"When setting the surtax rates, Canada has blindly followed the United States without conducting its own investigation or research, a move that is extremely subjective, vicious and unscrupulous," said Liang Ming, a researcher with the Chinese Academy of International Trade and Economic Cooperation under the MOC.

Describing Canada's practices as "outright discriminatory," Liang said China's anti-discrimination probe is aimed at safeguarding the rights and legitimate interests of Chinese companies in accordance with laws and regulations.

Noting that China is Canada's third-largest source of imported EVs and the second-largest source for its steel and aluminum imports, Liang criticized Canada's actions as "a blatant form of trade protectionism" that seriously violates WTO rules.

The basic principles of WTO boil down to non-discrimination, fair trade and transparency. Canada's moves have severely violated these principles and flagrantly challenged the global trade order, observers noted.

China is justified in taking relevant measures when facing discriminatory prohibitions and restrictions imposed by any country or region according to its own foreign trade law, Liang said.

"Such measures could be relatively extensive and are not limited to those sectors targeted by Canada's actions," he added.

By announcing tariff hikes without proclaiming any investigations beforehand, Canada is practicing "stark political manipulation," online media outlet Yuyuantantian cited professionals as saying.

Imposing higher tariffs on Chinese products in both emerging and traditional sectors "fully displays the malicious intention of the Canadian side," it said, noting that the actions taken by China are entirely defensive.

The anti-dumping probe into Canada's rapeseed exports will be conducted in accordance with China's relevant laws and regulations as well as WTO rules, while that into relevant Canadian chemical products will be launched at the request of China's domestic industries.

Citing recent reports from the Chinese domestic industry, the ministry spokesperson said Canadian rapeseed exports to China have increased significantly, with dumping suspected.

Canada exported 3.47 billion U.S. dollars worth of rapeseed to China in 2023, with the volume surging 170 percent year on year and prices continuously moving downward, according to the spokesperson.

"Affected by unfair competition from the Canadian side, China's rapeseed-related industries have continued to suffer losses," the spokesperson said.

China is the largest destination of Canada's rapeseed exports and an important importer of Canadian chemical products.

"China's position is clear-cut. The country will take all measures necessary to safeguard the legitimate rights and interests of Chinese companies," the spokesperson said.

"While Canada's actions will not hinder the stable growth of China's foreign trade and economy, their nature is appalling," Liang said, noting that they could mislead some inadequately informed countries and harm global trade liberalization.

However, as a consistent defender of and contributor to the multilateral trading system, China will ensure all the measures it takes are in line with international laws and WTO rules, industry insiders said.