Contacts: Wayne Ranick (412) 562-2444, wranick@usw.org
Gary Hubbard (202) 256-8125, ghubbard@usw.org
(Pittsburgh) – United Steelworkers (USW) International President Leo W. Gerard issued the following statement today in conjunction with the announcement by the Office of the United States Trade Representative (USTR) that it was pursuing action at the World Trade Organization (WTO) to force China to apply its 17 percent value added tax (VAT) to certain domestically-produced Chinese aircraft. Currently, China applies its VAT to imported aircraft, exempting domestically-produced aircraft in clear contravention of its WTO commitments.
“China has targeted industry after industry with unfair and often secret subsidies. America’s aerospace industry, one that widely supports manufacturing jobs all across the country, is yet another example. Tens of thousands of USW members working in the aluminum, steel, glass and tire sectors produce and supply materials and parts used in the domestic aerospace industry. The USTR’s actions are a critical part of a strategy to maintain U.S. leadership in this vital sector.
“China intends to be a major competitor in this sector. Its 12th Five Year Plan and supporting policies clearly identify its developmental aspirations. China showers the industry with subsidies and has accelerated the growth of its aerospace companies through coercive and often illegal means.
“USTR lawyers have obtained evidence that China was exempting an array of domestically-produced Chinese aircraft from paying the 17 percent VAT, while forcing foreign producers to pay it. This is done in secret, enabling China to sidestep agreed-to WTO obligations that require publication. These discriminatory actions injure U.S. producers and workers.
“China is one of the fastest growing markets for aerospace products. While foreign producers have long been key suppliers, China is pursuing a classic import substitution strategy: It looks to push foreign producers and goods out of its market as it rapidly develops domestically produced aircraft, turboprops, business jets and agricultural and utility aircraft. Despite joining and benefiting from WTO regulations, China wants to play by its own rules and shut down another key export market for American-made products. Its unfair practices have shuttered thousands of factories and have cost millions of American jobs.
“It’s time to ramp up action.
“The USTR has worked diligently and patiently to uncover China’s subsidy programs. Today’s action is an important step in demonstrating that America intends to enforce the rules and hold China accountable for stealing jobs in this and other industries.”
The USW represents 850,000 workers in North America employed in many industries that include metals, rubber, chemicals, paper, oil refining and the service and public sectors. For more information: http://www.usw.org/.
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