As expected, Chinese President Xi Jinping raised the issue of antidumping abuse during his recent visit to Washington. Specifically, he called on the United States to stop using “nonmarket economy” methodology when imposing antidumping duties on imports from China. The issue is going to become more and more pressing as a diplomatic problem over the next year, because the United States is required under WTO rules to end NME treatment by December 2016.
NME methodology is one of many ways the United States inflates the protectionist impact of U.S. antidumping law. My colleague Dan Ikenson has thoroughly documented the senselessness of NME treatment. Last year, I wrote a Cato Policy Analysis looking at how U.S. officials and policymakers might respond to the December 2016 deadline.
That deadline coincides closely with the end of President Obama’s term in office. The president can choose to leave his successor years of trade conflict and WTO litigation by refusing to act. Or he can do the right thing for the American economy and U.S.–China relations by ending NME treatment as soon as possible.