China said Thursday it was "highly concerned" over the US decision to ask the World Trade Organization to examine subsidies to the Chinese wind power sector, insisting its policies comply with WTO rules.
Less than a month before President Hu Jintao visits the United States, Washington said it had asked the Geneva-based trade body to deal with allegedly illegal subsidies that favour Chinese manufacturing firms.
In the latest in a string of trade rows between the two sides, the United States claims China offers multi-million-dollar grants only to companies making turbines and other equipment with Chinese parts, a violation of trade rules.
"China is highly concerned about the US raising the case to the WTO… China will carefully study the discussion request," the commerce ministry said in a statement.
"China's relevant measures to develop wind power are conducive to energy saving, emission reduction and environment protection. They are important approaches to realising sustainable development and comply with WTO rules."
The US request for WTO arbitration means that representatives from Beijing and Washington will have to discuss a solution within the WTO.
If no agreed solution is found, the United States can ask the trade body to move toward sanctions.
The United States and China are facing off over a long list of trade disputes ranging from tyres to chicken meat to the value of China's yuan currency.
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