The US decision to impose punitive duties on Chinese wooden furniture will not have a big impact on the industry as manufacturers make efforts to tap new foreign markets. However, domestic market competition is expected to increase.

The word "unfair" has frequently been used by the Chinese side in recent trade disputes between China and the United States.

"This decision is unfair to Chinese enterprises because the furniture industry is a competition-based industry in China," said an official for the Ministry of Commerce.

The US International Trade Commission on Friday gave final approval to anti-dumping duties of up to 198 percent on imports of about US$1 billion worth of wooden bedroom furniture from China.

The commission voted that imports from China were a threat to US domestic producers, which clears the way for the US Commerce Department to issue an anti-dumping order on the imports.

China has complained the duties violate World Trade Organization rules. The case is the largest US anti-dumping action yet against China.

"China's furniture industry has been completely market oriented and these companies completely follow market rules," the trade official said.

Some 90 percent of the companies are private, shareholding and foreign-funded, the unnamed official told China Daily.

The US Department of Commerce ruled in November on the anti-dumping duties on Chinese wooden bedroom furniture, which fall into several classifications.

The highest duty of 198 percent was put on one major Chinese furniture manufacturer and tens of thousands of smaller companies that account for a few of China's shipments to the United States.

For the other 115 Chinese companies, accounting for roughly 65 percent of Chinese furniture imports, the rate will be 8.64 percent. Another five companies accounting for about 35 percent of Chinese furniture imports will face penalty tariffs ranging from 2.22 percent to 16.7 percent.

Jia Qingwen, chairman of the China National Furniture Association, said it is wrong for the US Government to deny the Chinese industry the status as a market oriented industry (MOI).

Since the United States does not recognize China as a market economy, MOI status will help the Chinese industry win the case. Currently, the United States uses the cost of production in a surrogate country, where material and labor costs are much higher than in China, to calculate the normal value of Chinese exports.

But Jia said he believes exports of Chinese furniture will not decline dramatically, even with the anti-dumping ruling by the United States.

(China Daily December 13, 2004)