Win-win reforms expected for WTO

Necessary reforms of the World Trade Organization should leave basic principles of trade liberalization unchanged and take into consideration developing countries’ reasonable demands, the Ministry of Commerce said on Thursday.

Such reforms, a step-bystep process, should be based on mutual respect and benefits, ministry spokesman Gao Feng said at a news conference.

He said China will support the multilateral trading system in its keeping pace with the times, as this principle of the WTO has always played an irreplaceable role in opposing protectionism.

“The WTO is not perfect,” Gao said, stressing that the organization’s authority and effectiveness are threatened by the prevalence of protectionism and unilateralism.

The United States has for the past several months been wielding a tariff stick against economies including the European Union, Canada and China.

Mei Xinyu, a researcher at the Beijing-based Chinese Academy of International Trade and Economic Cooperation, said, “International cooperation that took decades to crystallize is now under threat from rising protectionism and unilateralism of the kind that the US has embraced in recent months.”

For instance, the US tariff action under Section 301 of US Trade Act of 1974 violated the principle of most favored nation status because US measures targeted only China but not any other country, according to Xiao Jin, a partner at King & Wood Mallesons, a multinational law firm.

Most favored nation status is essentially a method of establishing equality of trading opportunities among states by making originally bilateral agreements multilateral.

Given the current situation, WTO reform should strengthen the organization’s authority and leadership, and consolidate the basic functions and role of free trade principles and the multilateral trading system, to better promote global free trade and economic globalization, said Xue Rongjiu, deputy director of the China Society for WTO Studies.

“Free trade arrangements among WTO members are a helpful supplement and a positive driving force for the multilateral trading system,” Xue added.

Also at the news conference, Gao said China will continue its set course to open the economy, promote domestic reform and boost high-quality economic growth.

Asked about arrangements for the next round of trade talks, Gao said restarting negotiations depends entirely on the US. He stressed that China has always opened its doors to negotiate with US, but during trade talks, the sides must display sincerity, treat each other in an equal manner and keep promises.

“We hope that the Sino-US economic and trade frictions can be properly resolved. Meanwhile, we are getting ready to respond to various possible situations,” Gao said.

According to a Fung Business Intelligence report, sourcing businesses need to get prepared for possible escalation of China-US trade tensions and carry out strategic planning and revised planning for their supply chains to mitigate potential negative impacts on their business.

This includes exploring alternative sources of supply, redirecting shipments and restructuring production chains, the report said.

Iwrote in my column two weeks ago that if US President Donald Trump were to choose to speak at the 73rd session of the United Nations General Assembly, he would see many faces of resistance against his unilateral and protectionist policies. That proved true on Tuesday when he delivered his 35-minute speech at the UN General Assembly.

To the chagrin of the haughty US president, his excessive bragging of having “accomplished more than almost any administration in the history of our country” triggered laughter among the delegates from around the world. It is not known, though, whether he mistook the audience for his supporters attending his rallies, where he always speaks in a nationalistic tone and is so adept at spreading misinformation.

In a fact check after Trump’s speech, The Washington Post pointed to 14 key claims made by Trump on the UN General Assembly podium. They are either exaggerated or false, including the claim that the US lost more than 3 million manufacturing jobs and 60,000 factories after China joined the World Trade Organization.

While many in the United States tend to focus on Trump’s embarrassing moment of being laughed at on a global stage, what is dangerous for the world are his disdain for the world order and attacks on global bodies such as the United Nations, the UN Human Rights Council and the WTO.

Unlike his predecessors, who often liked to claim the moral high ground in their speeches, Trump is clearly not afraid of “going low” in front the international community.

He even unabashedly touted his decisions to withdraw the US from the Paris climate accord and the Iran nuclear deal, and to move the US embassy in Israel from Tel Aviv to Jerusalem, decisions that are widely regarded as disastrous for global peace and prosperity and have been condemned by the vast majority of UN member countries.

Trump didn’t shy away from threatening and coercing even poor countries, as he said the US is “only going to give foreign aid to those who respect us and, frankly, (are) our friends”. He also reiterated his pledge to cut funding for UN peacekeeping forces.

To Trump, the US, the world’s superpower, has been long victimized by every country in the world. “The United States will not be taken advantage of any longer,” he claimed on Tuesday.

This should wake up even those who still hold any illusion about Trump or his policies, as the US president laid bare his disruptive “America First” worldview on Tuesday.

French President Emmanuel Macron, who took the podium shortly after Trump’s speech, expressed the feeling of many countries when he passionately advocated multilateralism and denounced protectionism, claiming that “in the 21st century, we will only triumph through bolstered multilateralism”. In his 44-minute speech, the 39-yearold French leader even urged countries to stop signing trade agreements with those countries that don’t comply with the Paris climate agreement, a direct challenge to Trump.

On Monday, France joined Germany, Britain, China, Russia and Iran in recommitting to the Iran nuclear deal. And the European Union is working on a special payment system for trade with Iran to counter the Trump administration’s threat of imposing sanctions on economies that do business with Iran.

Trump may be hugely proud of his speech. But it’s really a confession about how during his less than two years of US presidency, he has been breaking global rules and norms faster than any of his predecessors. And that includes his trade conflicts with several economies which threaten to disrupt global supply chains and dismantle the global trading system.

If Trump’s speech at the UN General Assembly achieved anything, it is this: It helped rally the world against Trump’s unilateralism and protectionism.

This should wake up even those who still hold any illusion about Trump or his policies, as the US president laid bare his disruptive “America First” worldview ...