As a result of a complaint filed by the United States, the Chinese government now recognizes that export subsiding is prohibited by the World Trade Organization (WTO). On April 14, 2016, China and the U.S. signed an agreement to eliminate the subsidizing of Chinese companies that meet certain export performance targets.
According to the Office of the United States Trade Representative, prior to the recently signed agreement, China was subsidizing services to 179 groups of Chinese companies. The elimination of these subsidies levels the playing field, allowing companies across the globe to better compete with China exports.
As part of the agreement, China will withdraw central and sub-central funding for subsidized services and remove export-contingent performance targets from Chinese companies.
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