The US … uses smear tactics and blame-shifting methods to cover up its violations and sabotage
Ministry of Commerce
“China remains the biggest challenge to the international trading system established by the World Trade Organization,” US Trade Representative Katherine Tai said in the report, adding that in the 22 years since China acceded to the WTO, the country still “embraces a state-directed, non-market approach to the economy and trade, which runs counter to the norms and principles embodied by the WTO”.
“Even more problematic, China’s approach targets industries for global market domination by Chinese companies using an array of constantly evolving nonmarket policies and practices,” the report said.
Firing back, China’s Ministry of Commerce accused the US of not complying with WTO rules and of implementing “discriminatory” industrial policies that disrupt the global supply chain by deferring the responsibility of defending multilateralism to others.
“The US does not reflect on and correct its own behaviour, but instead uses smear tactics and blame-shifting methods to cover up its violations and sabotage. This is extremely irresponsible,” it said.
On Sunday, Chinese Commerce Minister Wang Wentao met with WTO director general Ngozi Okonjo-Iweala at the 13th Ministerial Conference of the WTO in Abu Dhabi, United Arab Emirates. During the meeting of the world’s trade ministers, Wang expressed China’s support for key WTO reform initiatives that would help it play a better role in global economic governance.
This, he said, includes striving for a resumption of the WTO’s dispute-settlement mechanism – the Appellate Body that the US paralysed by not allowing for new judges to be appointed.
The WTO has been unable to effectively address China’s continued pursuit of a state-led, non-market approach to the economy and trade
US Trade Representative Katherine Tai
The US report also acknowledged that Washington had taken “critical” domestic steps to invest in key industries, including by passing the Chips and Science Act, the Inflation Reduction Act and the Infrastructure Investment and Jobs Act, and moving to implement those acts.
The report further accused China of “routinely” deploying economic and trade policies and practices that promote unfair competition and state-directed outcomes rather than fair competition and market-based outcomes.
“Critically, the WTO has been unable to effectively address China’s continued pursuit of a state-led, non-market approach to the economy and trade,” it stated.
China’s customs figures showed that the value of imports and exports between the US and China in 2023 reached US$664.5 billion – an 11.6 per cent decline from 2022.
The US is now China’s third-largest trading partner, after Asean and the European Union.
“China’s accession to the WTO has been a landmark event both for China and the rest of the world,” Alicia Garcia-Herrero, chief economist for Asia-Pacific at French investment bank Natixis, said in a report on Monday. “China has no doubt reformed and opened up its economy, but not to the extent of becoming a full market economy.
“That duality – striving to operate as a market economy in some areas while keeping the key characteristics of a state-led planned economy in others – makes it very difficult for China to comply with the principles of the WTO.”
Garcia-Herrero added that it was “highly unlikely” that a WTO-reform proposal by the EU, focusing on the behaviours of state-owned enterprises, subsidies and countervailing measures, would come to fruition.
“In particular, the urgent need to deal with market distortions – stemming from China’s economic model, and its increasing size and influence in the rest of the world – might need to be addressed through other solutions,” she added.
TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
OTTAWA – Canada’s inflation rate fell to two per cent last month, finally hitting the Bank of Canada’s target after a tumultuous battle with skyrocketing price growth.
The annual inflation rate fell from 2.5 per cent in July to reach the lowest level since February 2021.
Statistics Canada’s consumer price index report on Tuesday attributed the slowdown in part to lower gasoline prices.
Clothing and footwear prices also decreased on a month-over-month basis, marking the first decline in the month of August since 1971 as retailers offered larger discounts to entice shoppers amid slowing demand.
The Bank of Canada’s preferred core measures of inflation, which strip out volatility in prices, also edged down in August.
The marked slowdown in price growth last month was steeper than the 2.1 per cent annual increase forecasters were expecting ahead of Tuesday’s release and will likely spark speculation of a larger interest rate cut next month from the Bank of Canada.
“Inflation remains unthreatening and the Bank of Canada should now focus on trying to stimulate the economy and halting the upward climb in the unemployment rate,” wrote CIBC senior economist Andrew Grantham.
Benjamin Reitzes, managing director of Canadian rates and macro strategist at BMO, said Tuesday’s figures “tilt the scales” slightly in favour of more aggressive cuts, though he noted the Bank of Canada will have one more inflation reading before its October rate announcement.
“If we get another big downside surprise, calls for a 50 basis-point cut will only grow louder,” wrote Reitzes in a client note.
The central bank began rapidly hiking interest rates in March 2022 in response to runaway inflation, which peaked at a whopping 8.1 per cent that summer.
The central bank increased its key lending rate to five per cent and held it at that level until June 2024, when it delivered its first rate cut in four years.
A combination of recovered global supply chains and high interest rates have helped cool price growth in Canada and around the world.
Bank of Canada governor Tiff Macklem recently signalled that the central bank is ready to increase the size of its interest rate cuts, if inflation or the economy slow by more than expected.
Its key lending rate currently stands at 4.25 per cent.
CIBC is forecasting the central bank will cut its key rate by two percentage points between now and the middle of next year.
The U.S. Federal Reserve is also expected on Wednesday to deliver its first interest rate cut in four years.
This report by The Canadian Press was first published Sept. 17, 2024.
FREDERICTON – New Brunswick‘s finance minister says the province recorded a surplus of $500.8 million for the fiscal year that ended in March.
Ernie Steeves says the amount — more than 10 times higher than the province’s original $40.3-million budget projection for the 2023-24 fiscal year — was largely the result of a strong economy and population growth.
The report of a big surplus comes as the province prepares for an election campaign, which will officially start on Thursday and end with a vote on Oct. 21.
Steeves says growth of the surplus was fed by revenue from the Harmonized Sales Tax and federal money, especially for health-care funding.
Progressive Conservative Premier Blaine Higgs has promised to reduce the HST by two percentage points to 13 per cent if the party is elected to govern next month.
Meanwhile, the province’s net debt, according to the audited consolidated financial statements, has dropped from $12.3 billion in 2022-23 to $11.8 billion in the most recent fiscal year.
Liberal critic René Legacy says having a stronger balance sheet does not eliminate issues in health care, housing and education.
This report by The Canadian Press was first published Sept. 16, 2024.
