China to ‘properly’ resolve Mexico’s textile subsidy complaint

17 january 2013

China has received a consultation request by Mexico over its subsidy policies to its textile and clothing businesses and will “properly” resolve the request following the dispute settlement procedures of the World Trade Organization, said a statement on the website of the Ministry of Commerce on Tuesday.

Mexico filed a complaint under the WTO on Monday claiming that China gives direct and indirect support to its producers and exporters of textile and clothing products.

The alleged supports or subsidies include tax reduction and exemption measures, and tax rebates, which run against WTO rules, Mexico said in the complaint.

Other subsidies that Mexico said broke WTO regulations included “extended terms of loan repayment, debt exemptions by State-owned banks and cash payments from government agencies”.

China has 60 days to resolve the dispute according to WTO rules. If no deal is reached in the consultation, Mexico is entitled to ask the WTO to set up a panel to rule on the case.