Poi­son pill terms will kill fair trade

China Daily (Canada) - - VIEWS -

In or­der to win in its trade com­pe­ti­tion with China, the Trump ad­min­is­tra­tion is pre­par­ing to es­tab­lish in­ter­na­tional trade and in­vest­ment rules that fa­vor the United States by build­ing dis­crim­i­na­tory trade blocs with its al­lies.

It wants to re­place the WTO rules with trade rules of its own de­vis­ing, and take ad­van­tage of trade terms that are in its fa­vor to seize the high ground in its eco­nomic com­pe­ti­tion with China.

To this end, the US in­cluded “poi­son pill” terms in the United States-Mex­ico-Canada Free Trade Agree­ment (USMCA), which was inked in Septem­ber, to iso­late so-la­beled non-mar­ket economies. And on Oct 16, the United States Trade Rep­re­sen­ta­tive Robert Lighthizer in­formed the US Congress that he in­tends to ac­cel­er­ate the trade ne­go­ti­a­tions planned with the Eu­ro­pean Union, Ja­pan and the United King­dom.

The Trump ad­min­is­tra­tion’s in­clu­sion of poi­son pill terms in trade agree­ments has ex­posed the US’ power pol­i­tics and uni­lat­er­al­ism in the in­ter­na­tional trade field and has drawn wide­spread con­cern.

The poi­son pill terms that the US is in­sert­ing into its trade agree­ments gives it the power to im­pose trade sanc­tions and other puni­tive mea­sures against any of its part­ners act­ing against its wishes. The US as the world’s largest econ­omy, is us­ing its mar­ket as lever­age to force rel­e­vant par­ties to ac­cept its for­eign trade rules, in or­der to main­tain the US’ eco­nomic in­ter­ests.

The US has con­tin­u­ally cre­ated global trade fic­tions in the past two decades by seek­ing to re­write the trade rules un­fairly in its fa­vor. The trade war launched by the Trump ad­min­is­tra­tion against China aims to forcedly open the gates to China’s mar­ket while at the same time re­strict­ing ac­cess to its own.

The Trump ad­min­is­tra­tion wants to re­write the in­ter­na­tional trade rules to seek the max­i­mum in­ter­ests of the US, while min­i­miz­ing those of China. Through its poi­son pill terms, the US wants to shape the in­ter­na­tional trade or­der and com­pel its trade com­peti­tor China to sub­mit.

The Trump ad­min­is­tra­tion is wor­ried that China’s rise as a great power will un­der­mine its ad­van­tages. The US is at­tempt­ing to use the poi­son pill terms in its trade agree­ments in or­der to pre­vail in what it re­gards as com­pe­ti­tion with a ri­val, and so con­trol the rule-mak­ing power of for­eign trade rules in the long term to sus­tain its pre­em­i­nence.

Poi­son pill terms are the strate­gic choice of the Trump ad­min­is­tra­tion. US Pres­i­dent Trump sup­ports eco­nomic na­tion­al­ism and trade pro­tec­tion­ism. He is con­tent to blame the prob­lems of US work­ers on in­ter­na­tional trade, and par­tic­u­larly trade with China. He ad­vo­cates anti-glob­al­iza­tion be­cause he is not sat­is­fied with the gains glob­al­iza­tion has brought to the US econ­omy and em­ploy­ment.

By us­ing poi­son pill terms in its trade agree­ments the US aims to con­sol­i­date its strate­gic al­liance re­la­tion­ship with its ex­ist­ing trade al­lies, as well as iso­late and at­tack its trade com­peti­tors. The fi­nal goal of the Trump ad­min­is­tra­tion is to guar­an­tee the con­tin­ued dom­i­nance of the US in the global econ­omy.

Once the Trump ad­min­is­tra­tion suc­cess­fully in­serts poi­son pill terms in its agree­ments with its ma­jor trade part­ners, it will en­able the US to adopt more ef­fec­tive re­tal­ia­tory mea­sures against its com­peti­tors us­ing trade rules.

The poi­son pill terms in the trade agree­ments ad­vanced by the Trump ad­min­is­tra­tion will not only un­der­mine China, an im­por­tant trade part­ner of the US, they will also de­stroy the ex­ist­ing global mul­ti­lat­eral free trade sys­tem based on WTO rules.

The au­thor is a re­searcher with Chi­nese Academy of In­ter­na­tional Trade and Eco­nomic Co­op­er­a­tion.

SONG CHEN / CHINA DAILY

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.