China Slams US "Green Veneer" at WTO

In a recent World Trade Organization (WTO) meeting, China accused the United States of using climate concerns as a cover for protectionism through the CHIPS Act and the Inflation Reduction Act. China argued that the US has disguised large subsidies that benefit domestic enterprises and discriminate against foreign competitors under a "green veneer."

According to China, the US measures distort global trade and market, violate WTO principles of national treatment and most-favored-nation treatment, and threaten the post-pandemic global economic recovery. The Asian giant warned that the US policies could harm not only China's interests but also those of the US and its allies.

China urged the WTO to strengthen its monitoring of measures that may violate its rules and expressed a willingness to work with other members to safeguard the stability and resilience of the global semiconductor supply chain and value chain.

Beijing criticized several proposed rules for implementing the IRA and CHIPS Act recently released by the US, claiming that they amount to "imposing protectionism in the name of green policy." China singled out specific conditions in the guidance for electric vehicle (EV) tax credits, which it said contain domestic local content requirements and discriminate against certain members.

China also questioned Washington's definition of a free trade agreement in the regulations, as it specifically identifies the recent critical minerals agreement with Japan as an FTA for purposes of meeting the criteria. Beijing asked the US to explain how this agreement could substantially cover all trade between Japan and the US, as required by Article 24 of GATT1994.

China warned that the US-Japan Critical Minerals Agreement could set a dangerous precedent, undermine the basic consensus on global trade rules, and cause irreversible systemic damage to the authority of WTO rules.