The Obama administration filed a trade complaint with the World Trade Organization on Thursday against China for allegedly "dumping" aluminum on the global market at artificially low prices.
U.S. Trade Representative Michael Froman said China is using artificially cheap loans and illegal subsidies to undercut the global price of aluminum. That makes it harder for the U.S. aluminum industry to sell its products overseas at competitive prices.
"China gives its aluminum industry an unfair advantage through underpriced loans and other illegal government subsidies," President Barack Obama said in a statement. "These kinds of policies have disadvantaged American manufacturers and contributed to the global glut in aluminum, steel and other sectors."
The artificially low prices were a factor in nearly closing the Intalco aluminum smelter near Ferndale. A renegotiated power deal and money for workforce training from the state helped avoid the closure last year.
This is the 16th trade enforcement challenge the U.S. has filed against China through the WTO. It's unclear what effect it will have considering the Obama administration ends in just over a week.
“Today’s actions are an important step and shine a light on a growing and urgent problem. It’s my hope this enforcement action will spur China to come to the table and have a broader conversation about the entire aluminum supply chain,” said U.S. Rep. Suzan DelBene, D-Medina, co-chair of the Congressional Aluminum Caucus.
President-elect Donald Trump made closing the U.S. trade gap with China a top priority during his presidential election campaign. He has threatened to slap 45 percent tariffs on Chinese products and to label China a "currency manipulator." Chinese officials warned that Trump is bound by World Trade Organization rules, which restrain countries from imposing sanctions without making a persuasive case for them.
In presenting his foreign policy platform last year, Trump said the Obama administration "allowed China to continue its economic assault on American jobs and wealth, refusing to enforce trade deals and apply leverage on China necessary to rein in North Korea."
He said that "China respects strength" and "we have lost all of their respect."
White House Press Secretary Josh Earnest acknowledged Thursday that the incoming administration "has spoken forcefully about their commitment for standing up for the United States when it comes to global trade."
However, he noted that some economists warn the policies suggested by Trump "will be damaging to workers, U.S. workers, bad for U.S. businesses, bad for U.S. entrepreneurs, bad for the broader American economy and bad for American college graduates that are entering the workforce."
The Bellingham Herald business reporter Dave Gallagher contributed to this report.