South Korean media: China imposes 78% tariff on U.S. specialty optical fiber

On the 3rd of this month, China decided to impose anti-dumping duties of up to 78.2% on U.S. specialty optical fiber. Analysts believe that this move is a countermeasure taken by China in the economic field after diplomatic means.

The Chinese Ministry of Commerce announced on the same afternoon as the military parade, starting from the 4th, imposing anti-dumping duties of 33.3%-78.2% on "related cut-off wavelength shifted single-mode fiber" produced in the United States. The measure will take effect from the 4th and will be valid until April 2028.

Since April 2011, China has imposed anti-dumping duties on "non-dispersion shifted single-mode fiber" produced in the United States, and in July 2018, the tax rate was raised to 33.3%-78.2%. This decision extends the same tax rate to "related cut-off wavelength shifted single-mode fiber". Optical fiber is a strategic technological product used in 5G communication, data centers, and high-speed internet, and China is one of the world's largest importers.

This year, American companies will be hit first. Among them, Corning (tariff rate 37.9%), OFS-Fiber (33.3%), and Draka Communications (78.2%) are all on the list, with market shares of about 10.4%. In comparison, South Korean LS Cable and Hanjin Cable are expected not to be greatly affected because they have no factories in the United States.

This anti-dumping investigation was initiated at the request of "China Fiber Optic Cable Company", and lasted for six months from March 4th.

In March of this year, fiber optic companies filed an anti-dumping application, which was a response to the "10+10%" tariff measures implemented by the Trump administration in the United States. China announced retaliatory tariffs on some U.S. agricultural products, listed companies on the "untrustworthy entity list", and simultaneously launched an anti-dumping investigation on fiber optics.

"Countermeasure against the U.S. strengthening its semiconductor restrictions on China"

Some analysts pointed out that this move is also a countermeasure against the U.S. strengthening its semiconductor restrictions on China. On the 29th of last month, the U.S. Department of Commerce revoked the "Verified End-User (VEU)" qualification of Samsung Electronics, SK Hynix, and Intel. On February 2nd, the same restriction was applied to TSMC. According to the VEU policy, these companies, although constrained by export controls on semiconductor equipment to China, can still export certain non-cutting-edge equipment to China without U.S. permission.

Bloomberg commented that "(the fiber optic tariff measures) are part of a new plan by the U.S. to curb China's semiconductor manufacturing capabilities." Neo Wang, Chief Economist for China at Evercore ISI, told Bloomberg, "This is a response to the U.S. revoking some of the semiconductor equipment exemption policies for China, intending to remind the U.S. side to avoid actions that damage trust and atmosphere during trade negotiations."

Sources: JoongAng Daily

Original: www.toutiao.com/article/1842393186021392/

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