Last year, the trump administration made a small move, issuing an announcement that goods made in Hong Kong must be marked as “made in China” when exported to the United States, instead of “made in Hong Kong”.
On Monday, the Hong Kong government and the United States confronted each other on the matter at a closed door meeting of the World Trade Organization (WTO), and their request for the establishment of an expert group was opposed. However, the report pointed out that the US side can only prevent this one time.
The US side refused the request of the Hong Kong government on the ground that
On January 25, the United States blocked Hong Kong’s request to upgrade a trade dispute left over from the trump era at the WTO. This is also the first WTO trade dispute meeting attended by the United States since Biden took office.
Hong Kong’s exports to the United States need to be marked as “made in China”, and the Hong Kong government and the United States confront each other in the WTO
A copy of the speech shows that when the US representative delivered a speech at the closed door meeting of the WTO dispute settlement body, he opposed Hong Kong’s request to set up an expert group to adjudicate the origin label dispute.
According to a source quoted by Hong Kong’s South China Morning Post, the US delegation said at the meeting that in view of the transition of the us to a new government, it could not support the request of the relevant expert group.
In response, Hong Kong said that it had taken into account the political situation in the United States, but still considered it necessary to continue to implement the panel’s request.
The Hong Kong delegation also pointed out that the US measures “do not recognize Hong Kong as a separate customs territory and a member of the WTO”. This has caused “unnecessary burden” to Hong Kong enterprises, caused “confusion and worry” to consumers and the market, and damaged “Hong Kong brand”. Moreover, rules of origin should not be used to “achieve political ends.”.
“Only this time”
On 29 June last year, the trump government announced the abolition of Hong Kong’s special status treatment and the suspension of preferential treatment for Hong Kong, including export license exemption, which is different from that of mainland China.
On August 11 of the same year, the U.S. Customs and Border Protection Service announced that “within 45 days from now,” the origin of domestic products exported to the United States “must be marked as” China. “.
After the announcement comes into effect, goods manufactured by Hong Kong companies will be subject to the same tariffs as those of mainland exporters. The Secretary for commerce and economic development, Mr Yau Teng Wah, later said that the US side had extended the implementation date of the new regulation by 45 days to November 9 in response to the request of some industries.
On November 3 last year, Hong Kong launched a dispute at the WTO over this provision of the US government.
It is worth noting that Reuters pointed out on the latest WTO meeting that the US government can only prevent this one time. As a member of the WTO, Hong Kong can make this request again in the WTO next month.
The South China Morning Post also further introduced that it is a common situation that the party receiving the complaint initially refuses the request of the WTO to set up an expert group. Such requests can only be passed by consensus, and the defendant actually has the right of veto.
However, in the second trial, we need to unanimously oppose the formation of an expert group in order to stop this request. Hong Kong can now request a special meeting of the dispute settlement body or wait for the next meeting of the body. By then, the request is likely to be passed.
According to the data of the Hong Kong Trade Development Council, the value of domestic goods exported to the United States in 2019 was US $471 million, accounting for only 0.1% of all the goods sent from Hong Kong.
John marrett, chief analyst of the economist think tank in Hong Kong, analyzes the US government’s small moves and believes that “although this is not a good thing from a macro point of view, it is not so meaningful. Because in general, the value is very small. ”
Wu Hongbin, President of the Hong Kong manufacturers association, told Hong Kong media in August last year that the relevant measures had little impact because Hong Kong’s manufacturing industry accounted for only a small part of its GDP. Moreover, these products are mainly provided locally, and the export volume is relatively small. The main reason is that Hong Kong factories set up factories in the mainland or overseas, and then export their products to the United States.
At that time, the Hong Kong government impolitely criticized the United States for “ignoring Hong Kong’s status as an independent member of the World Trade Organization”. If necessary, it could not rule out taking actions in accordance with the WTO rules to safeguard Hong Kong’s interests.
Observer: waiting for the new US trade representative to take office
In addition to the origin label dispute, the report points out that the closed door meeting of the WTO dispute settlement body held on the 25th is the first time that the United States has the opportunity to intervene in a long-term and active trade dispute and participate in the deadlocked reform negotiation of the WTO supreme appellate body.
Under the leadership of former president trump, Washington blocked the appointment of new judges to the appellate body and tried to force reform, which paralyzed the appellate body.
However, at Monday’s meeting, the Biden administration’s position on the agency remained unchanged, refusing to support the proposal to appoint new judges.
Although the Biden administration has officially taken over trade policy matters, observers do not expect any significant change in the direction of US government policy until the nomination of Chinese American Katherine Tai as US trade representative is confirmed.