President Obama late Friday erected a trade barrier against the import of tires from China, a controversial decision sure to anger America’s second-largest trading partner.
Mindful that the president was engaging in protectionism just over a week before the world’s largest economies meet to discuss the importance of keeping trade relationships open, the White House announced the decision a little over two hours before midnight.
Mr. Obama, who was required to make a decision on the issue by next Thursday, decided to impose a 35 percent tariff on Chinese imports for one year, followed by 30 percent in the second year and 25 percent in the third and final year.
Ron Kirk, the president’s trade representative, said the administration was “doing what is necessary” to protect American workers from unfair competition from Chinese-made tires.
China swiftly denounced the decision saying on Saturday the duties were a “grave act of trade protectionism” that may draw a further response from Beijing, Reuters news agency reported.
“China strongly condemns this grave act of trade protectionism by the U.S.,” said Yao Jian, the spokesman for China’s Ministry of Commerce.
“This step not only violates the rules of the World Trade Organization, it is also contrary to the relevant commitments that the United States government made at the G-20 financial summit,” he said.
Other critics also blasted the move.
“They’re making a major mistake in order to keep unions at bay. They’re sending a signal that it’s OK for countries to turn protectionist,” said Tony Fratto, a former Bush administration official who worked at the White House and the Treasury Department on trade-related issues.
“This is a president hostile to trade, despite his rhetoric when he travels to foreign countries,” said Mr. Fratto.
The United Steelworkers, which called for the tariff, said Mr. Obama had “made clear that he will enforce America’s trade laws and stand with American workers.”
“For far too long, workers across this country have been victimized by bad trade policies and government inaction,” said USW International President Leo W. Gerard.
Lawmakers from labor-heavy states applauded the president’s decision.
“The president courageously stood up and enforced fair trade rules that will save jobs and help our communities,” said Sen. Sherrod Brown, Ohio Democrat.
Mr. Obama’s decision came in response to a request by the USW - which represents many of the 8,000 American workers who it says have lost or will lose their jobs because of competition from Chinese tire producers - that the government impose a penalty.
The U.S. International Trade Commission (ITC) recommended in June that the government impose a 55 percent tariff, finding that surging Chinese imports had “disrupted” the U.S. market and could threaten U.S.-based rivals.
On Tuesday, the union requested that the president levy a barrier of even higher than 55 percent, saying that the Chinese had “cranked up their exports of tires” during the first part of the year in anticipation of Mr. Obama’s decision.
Mr. Kirk said that “these remedies are a necessary response to the harm done to U.S. workers and businesses, designed to achieve the objective of curbing what the ITC determined was a harmful surge of Chinese tires into the U.S. market.”
White House press secretary Robert Gibbs defended the decision in an e-mailed statement, saying that when it joined the World Trade Organization in 2001, “China agreed to a special safeguard mechanism that would allow its trading partners to implement remedies in response to import surges and under other circumstances.”
“The president decided to remedy the clear disruption to the U.S. tire industry based on the facts and the law in this case,” Mr. Gibbs said.