BEIJING, July 29, 2019 (BSS/AFP) – A US threat to pull recognition of
China’s “developing nation” status at the World Trade Organisation is a
pressure tactic ahead of this week’s trade talks and is bound to fail, a
commentary in state media said Monday.
The reaction followed a memo issued on Friday by President Donald Trump to
US Trade Representative Robert Lighthizer.
It said the WTO, which operates a global system of trade rules and settles
disputes, uses “an outdated dichotomy between developed and developing
countries that has allowed some WTO members to gain unfair advantages.”
Without “substantial progress” to reform WTO rules within 90 days,
Washington will no longer treat as a developing country any WTO member
“improperly declaring itself a developing country and inappropriately seeking
the benefit of flexibilities in WTO rules and negotiations,” said the
statement, which focused mostly on China.
The memo came ahead of meetings in Shanghai on Tuesday and Wednesday
between US and Chinese negotiators aiming to resolve a trade dispute that has
led to tariffs on more than $360 billion worth of two-way trade involving the
world’s two largest economies.
Washington “obviously timed the memo to serve as a new bargaining chip” in
the trade talks, the commentary from state-run Xinhua news agency said of the
WTO threat.
“But the tactic of imposing pressure is nothing new to China and has never
worked,” it said.
Xinhua added that the US government’s “latest hegemonic attempt” to coerce
the WTO “is destined to hit a wall of opposition.”
Developing country status in the WTO allows governments longer timelines
for implementing free trade commitments, as well as the ability to protect
some domestic industry and maintain subsidies.
But Jennifer Hillman, a former top US trade official who served at the
WTO, has said the benefits granted to countries with the special status in
most cases has long passed.
The Trump administration has long complained that WTO rules are unfair to
the United States, and has nearly throttled significant WTO proceedings by
refusing to name new members of the appellate body for the dispute settlement
system, which will cease to function later this year.
Despite Trump’s criticisms Washington has, in fact, won the majority of
complaints it has filed with the WTO.
Xinhua’s commentary said that “messing with” basic principles of the WTO
“will beget nothing but failure.”
“It will bring controversy and chaos, putting new obstacles in the way of
WTO reforms,” the commentary said.