WTO members continue to voice concerns on rise in safeguard measures, despite recent dip
Several delegations continued to voice concerns about the growing resort to safeguard actions by WTO members at a meeting of the WTO’s Committee on Safeguards on 24 April, despite a dip in the number of actions raised for discussion. Sixteen notifications of safeguard actions were addressed at the meeting. The United States sought clarification regarding Tunisia’s safeguard investigations while Brazil questioned China regarding its safeguard on sugar imports. In addition, the European Union cited concerns about new Malaysian safeguard measures on steel imports.
Canada, Japan, Australia, Korea and Chinese Taipei once again voiced concerns about the frequent recourse to safeguard investigations and imposition of safeguard measures by WTO members. They noted the number of actions notified to the committee appeared to be down from the previous meeting in October 2016, where 26 notifications of action were reviewed. Canada said it hoped this trend would continue, while Australia said safeguards activity was still high.
Japan again cited expanded production among emerging economies as the reason for the continued oversupply of steel and the subsequent use of safeguard measures to address the deteriorating market balance. Korea warned members should use safeguard measures with great caution, given the substantial chilling effect these measures can have on trade which in turn can be exacerbated by the growing anti-trade and protectionist sentiments in many countries.
In addition, several delegations noted that safeguard measures should only be used in emergency situations and that special diligence should be used when applying them.
Under the WTO’s Safeguards Agreement, a member may restrict imports of a product temporarily (take “safeguard” actions) through higher tariffs or other measures if its domestic industry is seriously injured, or threatened with serious injury, due to an unforeseen surge in imports.
In principle, safeguard measures apply to all imports and not just those from a particular country (developing countries accounting for less than 3% of exports are excluded from a measure). Because safeguards target “fair” trade, an exporting country can seek compensation for lost trade through consultations or, if no agreement is reached, it can raise tariffs on exports from the country that is enforcing the safeguard measure.
The committee, chaired by Mr Yusong Chen of China, reviewed new or amended national safeguards legislation submitted by Afghanistan, Armenia, El Salvador and the Kyrgyz Republic, and continued its review of previously notified changes submitted by Cameroon, the Russian Federation, the Dominican Republic and Kazakhstan.
The committee also reviewed notifications of safeguard actions taken by India, Indonesia, Jordan, Morocco, the Gulf Co-operation Council (GCC) countries, South Africa, Thailand, Turkey, Ukraine and Zambia. Most of the actions reviewed concerned safeguard measures imposed on imports of steel and other metal products.
The United States, joined by Turkey, enquired about the latest status of Tunisia’s three safeguard investigations while Brazil, joined by Korea, Australia and Cuba, questioned China regarding its safeguard investigation on sugar imports.
Under “other business”, Malaysia informed members of its decision to impose definitive safeguard duties on imports of steel wire rod and steel concrete reinforcing bars. The European Union expressed concern about the action. Turkey registered its concerns about Tunisia’s investigations on imports of ceramic tiles.
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