High stakes

Chinese-made consumer goods worth more than $1.7 billionwould be effectively excluded from the United States if American manufacturers win three major trade cases now before U.S. tribunals.

The high stakes are pitting retailers against producers, but also dividing industries and retailers, and adding tension to international trade relations.

The cases against wooden bedroom furniture, color TVs and farm-raised shrimp are a major concern for U.S. importers and the Chinese government, both big winners from international trade. The cases are a last hope for a small number of American manufacturers and producers that employ thousands of workers.

“If nothing is done to stem the tide of illegal imports, our company will be out of business by the end of the year,” Tom Hopson, president and chief executive of Five Rivers Electronic Innovations, a color TV manufacturer based in Greeneville, Tenn., said at a hearing of the U.S. International Trade Commission (ITC) this month.

China and some U.S. importers argue that rulings favoring manufacturers would not bring any jobs back to the United States, as other countries with low-cost labor, unaffected by duties, replace China. Instead, they see a short-term trade disruption caused by unwarranted protectionism and an unfair system.

So the U.S. importers — retailers and wholesalers — are trying to fight back.

Wal-Mart and Best Buy, two of the biggest color TV retailers, testified against Five Rivers and allied labor unions at the ITC hearing.

American restaurants, grocers, seafood distributors and processors have banded together to make a case that shrimp imports help support 250,000 jobs in the United States.

And the Furniture Retailers of America last week at the International Home Furnishings Market in High Point, N.C., promised a bare-knuckles fight to defeat the anti-import petition.

“The furniture case is the biggest ever against China. And, for the first time, this is really starting to hit consumer goods,” said Erik Autor, vice president and international trade counsel at the National Retail Federation, a group that represents department, discount and other stores.

Chinese wooden bedroom furniture imports in 2003 were valued at roughly $1.2 billion, color televisions at $276 million in 2003 and shrimp at $285 million in 2002, according to ITC documents.

But even retailers and manufacturers are divided.

“You need to support the country and the people. What reason do I have to support China?” said Harold Hewitt, owner of Superior Furniture and Carpets, a Beckley, W.Va., furniture store.

Small retailers like Mr. Hewitt cannot afford to import large containers of furniture from China and prefer to maintain long-standing relationships with domestic manufacturers. If the domestic companies go out of business, Mr. Hewitt said small shops like his probably would fail.

On the manufacturing front, several big companies also import from China and act as distributors. So businesses like Hooker Furniture in Martinsville, Va., bowed out of the coalition that petitioned for anti-dumping duties.

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