China will hold consultations with the United States later this month on industrial subsidies that Washington has complained about, according to the Ministry of Commerce.

The US government filed a complaint on February 2 with the World Trade Organization against subsidies granted to domestic industries, alleging it harms US manufacturers.

It complains that State subsidies for steel, paper, information technology and other industries allow China to export goods on the cheap and prevent US companies from competing on a level ground, both at home and in third markets.

"China has accepted the US request for consultation and the two sides will launch talks in Geneva in the last 10 days of this month," the ministry told China Daily yesterday.

Mexico, Japan, the European Union and Australia will join the Sino-US consultation as a third party.

The ministry said China will also accept the request for separate consultations filed by Mexico. The talks are likely to be held simultaneously with the Sino-US consultations.

Chinese experts said that the US had not put forward evidence on China's industrial subsidies, and the United States and other developed countries granted much higher subsidies, such as export tax rebates, to their own industries.

According to WTO regulations, the two sides have to settle the issue within 60 days through consultations. If they fail, the United States can appeal to a WTO dispute settlement panel.

It is the third time that the United States has taken China to the world trade body since Beijing joined the organization in 2001.

US Trade Representative Susan Schwab recently claimed the country might file another case at the WTO against piracy and counterfeiting of American goods in China

The US agreed last year to delay filing the case after China indicated its willingness to do more to address American concerns.

(China Daily 03/07/2007 page1)