China Agrees to End Trade Subsidies: US
'Market-distorting' tax breaks helped create imbalance
By Nick McMaster,  Newser Staff
Posted Nov 29, 2007 3:29 PM CST
U.S. Trade Representative Susan Schwab holds up case documents as she announces that China will end subsidies prohibited by the WTO, Thursday, Nov. 29, 2007, during a news conference in Washington. (AP...   (Associated Press)
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(Newser) – China agreed today to end trade measures the US had called “market-distorting”, the Associated Press reports, ending a months-long dispute before the world's top trade board. One set of tax breaks encourages Chinese firms to boost exports to the US and other countries; another set of tariffs made it tougher for US firms to export to China.

"This outcome represents a victory for US manufacturers, producers and their workers," said Susan Schwab, US Trade Representative. It is hoped that the termination of the subsidies will help reduce the US' $223 billion trade deficit with China, the largest in US history with a single country. Democrats say the Chinese must change many more policies to affect the deficit.