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China Imposes New Tariffs on Some Vehicles From the U.S.

December 14, 2011 by Leave a Comment

GUANGZHOU, China — The Chinese government increased trade tensions with the Obama administration Wednesday evening by unexpectedly imposing antidumping and antisubsidy tariffs on imports of sport utility vehicles and midsize and large cars from the United States.

The new tariffs, totaling up to nearly 22 percent of the import prices, will probably have a mainly symbolic function, rather than reducing the already skimpy sales of such vehicles in China. Other tariffs and taxes already in place have limited sales of American imports by helping raise their retail prices by about three times what the same cars and S.U.V.’s sell for in the United States.

Still, firing a trade volley at American exports of automobiles, one of the most politically sensitive industries in international trade, can only escalate trade hostilities between China and the United States.

China’s move drew immediate criticism from the Obama administration.

“We are very disappointed in this action by China,” said Carol Guthrie, a spokeswoman for the Office of the United States Trade Representative. “We will be discussing this latest action with both our stakeholders and Congress to determine the best course going forward.”

The Commerce Ministry of China, which has conducted a two-year trade investigation of the American imports, gave no explanation for its decision to impose the duties. Ministry officials could not be reached for elaboration Wednesday evening.

The duties would mainly affect General Motors, which exports Cadillac S.U.V.’s and cars to China; Chrysler, which exports Jeeps; BMW Group of Germany, which exports BMW S.U.V.’s from South Carolina; and Daimler of Germany, which exports Mercedes S.U.V.’s from a factory in Alabama.

Because of the high Chinese tariffs and taxes already in place, the vehicles are sold only in the thousands or even hundreds in China, and only to the most affluent. (A Jeep Grand Cherokee that begins at $27,490 at dealerships in the United States costs $85,000 or more in China.)

The White House announced last week that it would ask the World Trade Organization next Monday to open an investigation into Chinese restrictions on imports of American broiler chickens.

More significantly, Chinese government agencies and companies have been furious about a current American investigation into whether Chinese exports of solar panels to the United States might have received illegal subsidies or been dumped in the American market at prices below the cost of manufacturing them.

American officials have previously examined the methodology of China’s two-year-old antidumping and antisubsidy investigation of American-made automobiles and have found “significant problems,” said Ms. Guthrie, the United States trade spokeswoman.

One challenge for China, which recently celebrated its 10th anniversary as a member of the World Trade Organization, is whether Wednesday’s action will be allowed under W.T.O. rules.

The trade organization places many limits on a member nation’s ability to impose antidumping and antisubsidy measures, particularly on goods from countries that the W.T.O. has declared as having market economies, like the United States.

“Dumping” might be hard to demonstrate, given that the prices of the American vehicles — even before China’s tariff and tax mark-ups — tend to be higher than in the United States.

The Chinese accusation of subsidies may be linked to previous comments by Chinese officials questioning whether the Obama administration provided too much federal assistance to G.M. and Chrysler two years ago during the global financial crisis.

China started the automotive trade case after President Obama imposed steep tariffs on surging imports of Chinese tires in September 2009. After a lengthy inquiry, the W.T.O. ruled this autumn that the American tariffs on tire imports had complied with international trade rules.

The new tariffs China imposed Wednesday will be antidumping duties of 8.9 percent for G.M. vehicles, 8.8 percent for Chrysler, 2.7 percent for Daimler and 2 percent for BMW.

The ministry separately imposed additional antisubsidy duties of 12.9 percent for G.M. and 6.2 percent for Chrysler.

Article source: http://www.nytimes.com/2011/12/15/business/global/china-imposes-new-tariffs-on-some-vehicles-from-the-us.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Bucks Blog: The Case Against Ending Food Drives

December 8, 2011 by Leave a Comment

Church youth group members sort canned items for a food drive in Montana.Nikki Carlson/Havre Daily News, via Associated PressChurch youth group members sort canned items for a food drive in Montana.

Over on Slate yesterday, the new Moneybox columnist Matthew Yglesias sounded off on food drives. Having to pick up or sort your donations of random cans is highly inefficient. Much of the stuff that people remove from their pantries is unusable because it’s old or it’s junk food, he said. Plus, most food banks, he noted, can buy highly discounted bulk food in a variety of ways.

It’s better, he concluded, to simply hand over the money you would have spent on the food at retail prices and let the food banks buy what they need on the cheap.

There is part of me that loves the pure rationality here. But here’s what you miss when you make this all about the money: the opportunity to teach. For a child, for instance, a food drive offers all sorts of lessons.

The conversation might start here: Sometimes, we buy more than we need. Isn’t that silly? What can we do here in our house to figure out the difference between things we need and things we want? The discussion possibilities are endless; every room offers fodder, not just the kitchen.

But let’s say we do have more than we need. If that happens, we can give it to someone who has less than they need. The visceral experience of sorting through physical items (including toys and clothes and books) and figuring out what isn’t truly necessary is something that you can’t easily replace by writing a check to the needy.

Then, you pack up the items and deliver them to a central collection point. The volume of items is itself illuminating: Oh look, others are trying to help, too. We’re all in this together. Can we do it again sometime? Or, alternatively, why is it that no one is helping? Can we help get the word out?

I’m not sure whether the real and pressing need to teach children to be charitable outweighs any hassle or waste that is created by the cans themselves. But I’m pretty sure that the children who participate in food drives stand a good chance of growing up to be adults who write the sort of checks that Mr. Yglesias calls for. Or of turning into the sort of children who might bring a few dollars from their allowance, too, the next time there is a canned food drive in their community.

What do you think?

Article source: http://feeds.nytimes.com/click.phdo?i=3a4d8dfd74a0d7f9b08a4b2480355df2

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E.U. Telecommunications Operators Seek to Rush Through Price Rises

April 11, 2011 by Leave a Comment

BERLIN — The price of broadband and phone services in Europe is poised to rise as the Continent’s big operators win large rate increases from their national regulators before the implementation of a new law that gives the European Commission more influence over setting of rates.

In Germany, Italy and Spain, the former monopolies, Deutsche Telekom, Telecom Italia and Telefónica, have sought increases of as much as 25 percent over three years in the fees they charge other operators to rent access to their land line networks.

The fees, called wholesale access charges, average €6.67, or $9.63, a customer a month in Europe, according to a survey by Cullen International, a research group in Brussels. They can reach more than €10 in countries like Germany, where wholesale charges are typically passed on to consumers through higher retail prices.

Smaller operators have complained that the increases, all sought before May 25, when the European Commission gains new power to challenge national rate decisions, will further limit competition in these markets. Smaller operators typically lease part of the market leader’s land line network to deliver nationwide service.

Larger operators say the increases are needed to reflect their operating costs, and to prepare for the transition to faster fiber optic networks, which they have started building to replace the copper-based networks that make up the bulk of the European telecommunications grid.

“The net effect of these increases has been to preserve the dominance of the former monopolies,” said Vicky Hanley-Emilsson, a policy adviser with the European Competitive Telecommunications Association, a group based in Brussels that represents smaller operators.

The last-minute increases are part of a broader debate over how much Europe’s telecommunications operators will be able to charge rivals for access to new, super-fast fiber optic networks. Big operators are urging the European Commission to set the fees at a level that will ensure the profitability of the newer networks.

Brian Williamson, the director of Plum Consulting, a London firm hired by the European Telecommunications Network Operators’ Association, or ETNO, which represents Europe’s biggest operators, said operators were concerned that new pricing rules being devised in Brussels could make the new networks commercially unviable and slow their construction.

“It might be that the regulation won’t prevent any investment, but there is a question about how far the private sector will go, and that depends on the ultimate regulation and the nature of investment put in place,” Mr. Williamson said.

A slow pace of investment would hinder the European Commission’s goal of bringing broadband service with download speeds of at least 30 megabits a second to all European Union residents by 2020. Neelie Kroes, the E.U. commissioner responsible for telecommunications, is working on a plan to set fees that encourage investment while protecting small rivals. A key part of the discussion is the commission’s policy on access charges for the old copper networks during the upgrade to fiber, which is expected to take several years. Large operators say access prices to the older networks should not be aggressively lowered, or consumers will have no incentive to pay for faster fiber services.

“Driving down copper prices would discourage investment, firstly, by encouraging customers to stay on copper,” said Luigi Gambardella, the chairman of ETNO, adding that it would also have hurt fiber by distorting retail price levels for ultra-fast broadband products.

Smaller operators say the fees for copper networks, whose investment costs were recouped decades ago, remain artificially high, and recent rate increases will only give big operators less incentive to build new networks.

The Spanish regulator is proposing to raise wholesale access charges to Telefónica’s grid by 7 percent, to €8.32 a month. Carmen González, the director of a group representing small Spanish operators, said that some of her members were worried that the increase would squeeze them out of the market.

In Italy, Fastweb, a broadband operator owned by Swisscom, estimates that the Italian regulator’s decision last October to grant a 25 percent increase in access charges to Telecom Italia over the next three years would cost Fastweb €12 million a year.

Article source: http://www.nytimes.com/2011/04/11/technology/11iht-telecom11.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,