On November 10, 2001 after signing China’s WTO accession agreement, Shi Guangsheng, China’s Minister of Foreign Trade and Economic Cooperation at the time, toasts China’s entry to the international body with other representatives of WTO member countries.
By EVANDRO MENEZES DE CARVALHO
The assumption is that the multilateral trading system of the WTO favors the economic development of its member countries.
In some circumstances, the WTO allows countries to establish trade barriers to foreign goods and services, but with the aim of protecting the consumers, the environment, or the safety of their population, for example. Thus, there are defense mechanisms against predatory practices in the guise of free trade, that is, against state policies that destroy the structural conditions of the multilateral trading system itself.
There are numerous trade disputes within the WTO. Many decisions taken by the arbitration panels or by the WTO Appellate Body are questioned by countries that feel disadvantaged. But one thing is certain: to give up the WTO is to accept that the multilateral system of rules of trade be replaced, as pointed out by the Director General of the WTO, Roberto Azevedo, by the law of the jungle. In this scenario, the economically powerful party or country will dictate the rules of international commerce and it will be itself the sole arbitrator of its own interests and disputes.
Similar to many other post-World War II international organizations, the WTO is also experiencing a crisis of effectiveness and legitimacy. The Doha Round Trade, which was launched at the Qatar WTO meeting in November 2001, had as a goal, expected to reach a conclusion by January 2005, but it failed mainly because the United States and the European Union refused to reduce agricultural subsidies. And recently, some countries are even threatening to quit the WTO.
After China’s accession to the WTO in 2001, China’s contribution to global economic growth has kept rising, now up to 30 percent. Currently China’s import and export shares of the world total stand at 10.2 percent and 12.8 percent respectively.
Fortunately, China, as the second largest economy in the world, is expressing fundamental support to the WTO for the organization continues to play a greater role in economic globalization. In June, the Chinese government published the White Paper entitled “China and the World Trade Organization,” stating that the country “firmly supports the multilateral trading system with the WTO at its core” and that the country opposes unilateralism and protectionism, reaffirming its fulfillment commitments on trade in goods, in services, on IPR protection, and on transparency. These are commitments that are totally in line with WTO principles.
China’s accession into the WTO in 2001 had an undeniably positive impact on international trade. Since then, China’s average contribution rate to global economic growth has reached nearly 30 percent. Import and export volumes represented, respectively, 10.2 percent and 12.8 percent of the world total. But the Chinese presence in the world economy and trade may have worried some countries. However, these countries need to pay attention to the fact that China is entering a phase of its economic development with enormous potential for the growth of consumption and import of goods and services, valued at over US $10 trillion in the next five years. In other words, China will open up even more to the world. A clear demonstration of this trend is the China International Import Expo to be held in Shanghai in November 2018. From this perspective, the current trade conflicts between the U.S. and China should not only focus on the present numbers of the trade balance, but above all, see the promising future.
WTO is facing a difficult moment. Referring to it as a “trade war” is to assume the secondary role of two important dimensions to the multilateral trading system: 1) the observance of international trade law and 2) the search for a negotiated solution to the trade conflicts. Instead of having a secondary role, WTO should be given greater importance. China’s support for the organization is, in this sense, a boost. There is a rule in diplomacy that trade disputes must be treated in a way that does not contaminate other dimensions of diplomatic relations between countries involved in a trade dispute. Thus, when there is a controversy between countries, the first golden rule is to talk. And we should not forget that international trade is one of the pre-conditions to maintaining peace in the world. And constructive dialogue is essential for the maintenance of peace and avoidance of conflicts seeping into other arenas.
EVANDRO MENEZES DE CARVALHO is professor of international law at FGV and UFF (Brazil), head of the Center for Brazil-China Studies, chief executive editor of China Today in Brazil, and author of the book Semiotic of the International Law: Trade and Translation (Springer).
