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China may temporarily reserve its right to impose $3.6 billion in sanctions on US products as recently approved by the World Trade Organization (WTO), amid optimism over a first-phase trade deal with Washington, Chinese experts predicted.
Beijing does not necessarily need to activate the sanctions if the trade consultations develop smoothly, Huo Jianguo, vice chairman of the China Society for World Trade Organization Studies, told the Global Times on Monday.
The latest arbitration decision by the WTO is not directly connected to the current trade war, Huo said.
Since the US failed to abide by anti-dumping rules involving Chinese products, the WTO on Friday announced it would grant China the right to request authorization from the WTO's Dispute Settlement Body to suspend concessions or other obligations at a level not exceeding $3.579 billion annually.
The case was filed in 2013 by China, long before the trade war broke out.
"To activate the sanctions could make up for some past losses by [Chinese enterprises]… but it would cast a shadow on the first-phase deal of the trade talks as well," Gao Lingyun, an expert at the Chinese Academy of Social Sciences, a think tank, told the Global Times.
Media reports noted that $3.6 billion is not a big figure compared with the current hundreds of billions of tariffs imposed in both directions, but it could serve as leverage in China's talks with the US.
Given the current good atmosphere of the bilateral talks, it would be better if any trade issues could be resolved by consultations, said Bai Ming, a research fellow at the Chinese Academy of International Trade and Economic Cooperation in Beijing.