WTO backs US in chicken trade dispute with China

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By MARJORIE OLSTER, Associated Press

WASHINGTON (AP) — The World Trade Organization ruled in favor of the U.S. on Friday in a long-standing trade dispute over allegations China unfairly imposed anti-dumping tariffs that restricted American poultry exports.

The U.S. appeal to the WTO dates back to 2011 after China said that America had engaged in dumping and had imposed tariffs on imports of so-called "broiler products," which include most chicken products with the exception of live chickens. China said U.S. chicken producers benefited from subsidies and were exporting their goods to China at unfairly low prices.

Countries are allowed to impose punitive tariffs to offset both practices, but U.S. officials said China did not follow proper procedures when it imposed them in September 2010. The U.S. also said tens of thousands of jobs were affected — China was among the top two markets for U.S. chicken exports before the tariffs.

U.S. Trade Representative Michael Froman said this was a victory for the U.S. that he hopes will discourage further violations that hurt American exporters.

"This decision sends a clear message that the Obama Administration can fight and win for American farmers, businesses, and workers in the global trading system, ensuring that America gets the benefit of the rules and market access we have negotiated in our international trade agreements," Froman said in a statement. "WTO members must use trade remedies strictly in accordance with their commitments," he added.

U.S. Secretary of Agriculture Tom Vilsack said agricultural exports are a strong and growing component of U.S. exports. Farm exports in fiscal year 2012 reached $135.8 billion and supported 1 million American jobs, he said, adding that more than $23 billion worth of those agricultural products went to China alone. The U.S. and China are the world's largest economies.

"But China's prohibitive duties on broiler products were followed by a steep decline in exports to China - and now we look forward to seeing China's market for broiler products restored," Vilsack said in a statement. "This is an important victory today for the U.S. poultry industry, and for American farmers and ranchers."

The ruling found that China breached its WTO obligations and recommended that China comply with WTO rules. However it did not specify the actions that China must take. China is entitled to a period of time to comply with the rules and can also appeal the ruling.

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