China demands talks with U.S. on tire tariffs

China is demanding talks with the U.S. and has filed a complaint to the World Trade Organization on Barack Obama's decision to impose tariffs on tires from the Asian nation.

"China's requirement for talks with the U.S. is a proper practice to exercise its rights as a WTO member and is a practical move to defend its own interests," Yao Jian, the spokesman for China's Ministry of Commerce, said in a statement posted on its Web site on Monday.

Obama announced duties Sept. 11 of 35 percent on $1.8 billion of automobile tires from China, acting on a complaint by the United Steelworkers union against the second-largest U.S. trading partner. China said yesterday it will begin dumping and subsidy probes of chicken and auto products from the U.S.

The U.S. decision violated WTO rules and was an "abuse of trade-remedy measures," Yao said today. China will help tire makers "overcome this difficulty and is highly concerned about the negative effect the decision may have on its export companies," the ministry's vice minister Zhong Shan said in a separate statement.

The government has filed a formal complaint to the WTO, the Chinese mission to the Geneva-based body said today.

WTO Consultations

Under WTO rules, the two countries have 60 days to resolve the dispute through consultations. If those fail, China can request a WTO panel to investigate and rule on the case.

"The U.S. is confident that our action is fully WTO- consistent," Carol Guthrie, a spokeswoman for the U.S. Trade Representative's office, said in an interview today. The safeguards were part of "the deal China agreed to when it joined the WTO."

WTO disputes "like this are a normal component of a robust relationship," she added.

Rubber futures in Shanghai tumbled by the daily trading limit today because of the tire tariffs. The January-delivery contract dropped 5 percent from the previous settlement to 17,710 yuan a metric ton.

Rising protectionism may hamper world trade and undermine the global economy's recovery from recession, the European Central Bank said last week.