WTO agreements may complicate any auto industry bailout.

[girl gone mad]

American Hypocrisy in Auto Rescue Spurs Me-Too Trade Ire (Update2)

By Jennifer M. Freedman

Nov. 21 (Bloomberg) -- A U.S.-triggered spate of global carmaker-bailout proposals may spark trade disputes over whether the Americans are unfairly trying to subsidize their industry or just making up for state aid foreign rivals already enjoy.

As the U.S. considers a lifeline for its automakers, officials in Europe, Canada and Asia are considering their own aid packages -- even as the European Union threatens to lodge a complaint against any U.S. bailout to protect manufacturers from Renault SA in France to Fiat SpA in Italy.

(snip)

Any American package will be scrutinized by other countries to see if it runs afoul of WTO rules, which allow certain kinds of subsidies, such as those that protect the environment, but bar others, including payments to exporters.

The EU threatened to lodge a complaint against any U.S. auto package on Nov. 14, when European Commission President Jose Barroso said the bloc was examining the rescue proposal and would ``certainly act at the WTO'' if it contravenes trade rules.

Korean President Lee Myung-bak told CNN on Nov. 17 that he supports a U.S. bailout but warned that it must ``give more serious consideration to the method'' because it ``could run counter to WTO rules and set a bad precedent. Then, other countries may follow the example of the U.S. to directly subsidize their automakers.''


China ``quite possibly'' may lodge a WTO complaint if the U.S. bails out its industry, said Kirch, the trade lawyer. ``It might also bring a case if Europe does.''

http://bloomberg.com/apps/news?pid=20601109&sid=az43Y55hmZhY&refer=home

[Taverner]

1. But Europe has already bailed out their auto companies...

[DJ13]

2. I hardly think loans to preclude bankruptcy are a "competetive advantage"

or fall under the jurisdiction of the WTO.

If thats the way these other countries want to play this there probably wont be any US, European, or Eurasian auto companies alive by the time this crisis is over with.

[HeresyLives]

3. PM Brown of the UK

warned them about this some time ago.

I see nobody was listening.

[blue97keet]

4. To hell with the WTO anyhow

[99th_Monkey]

5. China "complains" about bail-out, while it's trying to buy up US Auto Mfgrs.??

No conflict of interest there.
:sarcasm:

[amandabeech]

6. The WTO simply may not be useful. It simply may not work.

If it does not allow us to fix our internal problems, then it should be modified, just like Detroit and Wall Street's exec pay, for example.

What's so special about the WTO?