China has lost a dispute against the European Union to secure market-economy status at the World Trade Organization (WTO). WTO in a statement said the Asian country allowed the dispute to lapse after it failed to request the special panel to resume its work within the stipulated time of 12 months.
In 2001, during China’s accession to WTO, agreed terms stipulated that the country could be treated as a ‘non-market economy’ by the members of the trade body. A non-market economy is the one which does not operate on market principles of cost or pricing structures. The status thus makes China prone to anti-dumping measures levied by other countries.
European Union is already of an opinion that China subsidises its industry, making sales prices of its products, particularly steel and aluminium, in the international market unfair. This move by the WTO will allow the EU or the US to levy high anti-dumping tariffs on goods from China.