ANSAC's Statement to U.S. Senate on China's VAT Rebate
June 22, 2010
China's VAT rebate for soda ash exports has stimulated excessive soda ash capacity expansions in China, has given China an artificial incentive to export, and has driven Chinese soda ash prices down at the expense of U.S. exports.
All of this is happening in the midst of a major decline in global demand for soda ash. The VAT rebate is an irresponsible industrial policy during this troublesome economic period.
The VAT rebate policy should be high on the agenda of the U.S. trade and economic discussions with the Chinese Government, including bilateral (JCCT, S&ED) and multilateral (WTO, OECD) fora. The removal of China's VAT rebate on soda ash exports would not only help the U.S. soda ash industry and U.S. manufacturing, but would serve to help recalibrate China's industrial policies away from energy-intensive, environmentally-damaging, export-driven growth.
Click here to download a PDF copy of the entire statement.