U.S. Department of Commerce Issues First Analysis of Currency Undervaluation as a Countervailable Subsidy
WASHINGTON – Today, the U.S. Department of Commerce announced affirmative final determinations in the antidumping duty (AD) investigations of passenger vehicle and light truck (PVLT) tires from South Korea, Taiwan, Thailand, and Vietnam; and the countervailing duty (CVD) investigation of PVLT tires from Vietnam.
In the AD investigations, Commerce determined that exporters have dumped PVLT in the United States at the following rates:
- 14.72 to 27.05 percent for South Korea;
- 20.04 to 101.84 percent for Taiwan;
- 14.62 to 21.09 percent for Thailand, and;
- 0.00 to 22.30 percent for Vietnam
In the CVD investigation, Commerce determined that exporters from Vietnam received countervailable subsides. This finding includes Commerce’s first affirmative findings regarding a currency-related subsidy involving the conversion of U.S. dollars into Vietnamese dong at an undervalued exchange rate. This is the second CVD investigation and first affirmative final determination involving the Currency Rule, which Commerce issued in February 2020. The Currency Rule sets out the approach that Commerce takes when investigating an allegation that an undervalued foreign currency provides a countervailable subsidy to foreign producers and exporters in a CVD proceeding. As part of its analysis of such an allegation, Commerce relies on the Department of Treasury’s evaluation and conclusion as to whether government action on the exchange rate has contributed to currency undervaluation. The company-specific countervailing duty rates calculated for Vietnamese respondents in this investigation, which includes this currency-related program, range from 6.23 percent to 7.89 percent. The Currency Rule applies to all CVD proceedings initiated after April 6, 2020.
The petitioner for these investigations is the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO, CLC (Pittsburgh, PA).
The U.S. International Trade Commission (ITC) is currently scheduled to make its final injury determinations on or about July 5, 2021. If the ITC makes affirmative final injury determinations, Commerce will issue AD and/or CVD orders. If the ITC makes negative final determinations of injury, the investigations will be terminated, and no orders will be issued.
In 2020, U.S. imports of PVLT were valued at approximately $1.2 billion, $373 million, $2 billion, and $470 million, for South Korea, Taiwan, Thailand, and Vietnam, respectively.
Read the fact sheet on today’s decision(s).