Foreign Industrial Targeting--U.S. Trade Law Remedies

GAO discussed: (1) the effects of foreign industrial targeting practices on U.S. commerce; (2) whether such practices should be considered unfair under U.S. law; and (3) whether current law adequately addresses any subsidy element in foreign industrial targeting practices.

GAO noted that a number of businesses and labor leaders contend that foreign government support of specific industries, called foreign industrial targeting, gave foreign firms an unfair advantage over their U.S. competitors and constrained U.S. businesses from being internationally competitive. GAO found that: (1) many factors such as the economic condition of both the industry being targeted and the nation providing the assistance determines the fairness of foreign industrial targeting; and (2) the effects of a targeting practice on U.S. businesses cannot be accurately measured. GAO believes that current U.S. trade law has the capability to address instances when foreign industrial targeting unfairly affects trade, even though the effects of such targeting cannot be adequately measured in all cases.