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Wiley Rein Publishes Report – China’s Broken Promises: Why It Is Not a Market Economy
Wiley Rein LLP’s prominent International Trade Practice published a report today which illustrates why the U.S. Department of Commerce should continue to treat China as a non-market economy in U.S. antidumping proceedings. The report analyzes the characteristics and consequences of China's rejection of market principles, including:
- Strict capital controls and management of the RMB exchange rate;
- Political and legal restrictions on organized labor and collective bargaining;
- Strategic management and control of foreign investment pursuant to industrial policy objectives;
- Disproportionate and expanding state ownership and control of important enterprises in key economic sectors;
- Distortions in the allocation of resources like financial capital and raw materials; and
- Poor transparency and rule of law.
Based on an analysis of these and other economic distortions, the report concludes that “China has not only failed to complete its transition to a market economy, but has consciously rejected the notion that economic development should be guided primarily by market forces. Instead, it has actively pursued a model of heavy‐handed state ownership and intervention.”
It was originally filed pursuant to the U.S. Department of Commerce’s recent Inquiry into the Status of the People’s Republic of China as a Nonmarket Economy Country Under the Antidumping and Countervailing Duty Laws. The original filing with accompanying exhibits is available on the docket of that inquiry here.
To read Wiley Rein’s full report, please click here.