China Center for International Economic Exchanges

Wei Jianguo: China is the biggest victim of the unequal trade rules
Date:Jan 22,2018    Source:CCIEE

On January 19, 2018 (U.S. local time), the U.S. Trade Representative Office published a report on its website, accusing China and Russia of violating the rules they agreed with and not keeping their promises they made when joining the World Trade Organization(WTO). In the report, the United States said that it was a mistake to support China's accession to the WTO in 2001.

In response, Wei Jianguo, Vice Chairman of CCIEE and former Vice Minister of Commerce, China, claims that China is the biggest victim of the unequal trade rules and as a matter of fact, the United States government is the one who does not abide by WTO rules.

In an exclusive interview with China Daily on Sunday, Mr. Wei said: “China has made numerous efforts to eliminate nearly 8000 documents, policies or measures that are inconsistent with the WTO rules since its accession to the WTO. At the same time, it has reduced the tariffs to the standard it promised before joining the WTO, sometimes the reduction is even more than its promise. "

Mr. Wei cited the comments made by former U.S. trade negotiator Charlene Barshefsky, “China is the best student after joining the WTO.” She also believes that China will enjoy more popularity from WTO and its member states if China continues to make efforts. China's return to international trade is a great joy in world trade. Former U.S. The former US Trade Secretary Gutierrez also said that the efforts made by China after joining the WTO deserve global admiration. To be fair, China has done a strenuous and remarkable reform.

In the view of Mr. Wei, all the previous U.S. governments think that China has overcome many restrictions on policies, systems and markets, made efforts to comply with the WTO rules and achieved significant progress.

On the contrary, however, the US authorities are increasingly ignoring the WTO rules. Mr. Wei pointed out that the US takes the lead in refusing to recognize China's market economy status. Furthermore, the US puts the "Section 301" as the international law above the rules of global trade. The "Section 301" is the abbreviation of Section 301 of the US Trade Act of 1974. The so-called 301 investigation comes from the Section 301, which was launched during the Cold War era and is regarded as a tool of trade diplomacy.

“This kind of assertiveness of the United States is increasingly causing global anger," Wei stressed.

The U.S. Trade Representative Office also said in the report that 20 years after its accession to the WTO, the Chinese government still continues to extensively implement intervention policies and measures to restrict the market access of imported goods and services, foreign manufacturers and service providers.

Wei responded by saying that after China's accession to the WTO, it has opened its doors to all the nations and allowed the market to play a decisive role in resource allocation, as well as actively promoted trade liberalization and investment facilitation.

According to the “2017 American Business in China White Paper” released by the China General Chamber of Commerce, 68% of the US companies said their business operations in China were profitable in 2016, while 58% of the respondents said their business revenue in China has increased.

However, the United States has stopped many Chinese private-owned enterprises from investing in the US, the so-called “endangering national security and ecology” is questionable. Wei said: "So far, the US government has only approved one investment project with the worth of over 10 million USD.

Since Trump came to power, China and the United States have reached many economic and trade achievements through dialogue and consultation. However, according to the report of the U.S. Trade Representative Office, measures like "China re-open its market to the US beef and lamb industry is insignificant."

In Wei’s view, the remarks above show that the United States is on the way to trade protectionism and runs counter to global investment facilitation and trade liberalization.

In fact, China has become an important overseas market for many products of the United States, most notably agricultural products and high-end manufactured goods. According to the statistics of the Ministry of Commerce, China is the largest export market for U.S. aircraft and soybeans, and the second largest export market for automobiles, integrated circuits and cotton. Among the US total exports, 62% of its soybeans, 17% of cars, 15% of integrated circuits, 14% of cotton, and about 25% of Boeing aircraft are sold to China.

According to the“Research Report on the Economic and Trade Relations between China and the United States" , launched by the Ministry of Commerce of China last May, China will expand its import from the United States in the next five years, and the total import volume will reach 8 trillion dollars in fields such as energy, agricultural products, manufacturing products, Service trade and so on.

The customs data show that China’s imports from the US amounted to 1.04 trillion Yuan in 2017, an increase of 17.3% over the previous year. In the same year, the total value of trade between the two countries was 3.95 trillion yuan, up 15.2% over the previous year and accounting for 14.2% of China's total import and export value.

Regarding the future economic and trade trend between China and the United States, Wei said that 2018 is a crucial moment for the bilateral relations and hopes that China and the United States can make full use of the existing channels of dialogue and continue to solve their problems peacefully.

"We do not want see a US-China trade war because it will not only hurt the two countries’ economic and trade interests, but also affect the global economic development and recovery. However, if the United States really wants to abuse the trade protectionism, China has a way to deal with it. The US should cherish China’s tolerance, not using it to bully China, which is not allowed. "

"I hope the United States can recognize that China is formulating international rules with the United States and other countries."

Mr. Gao Feng, the spokesman of the Ministry of Commerce, China, also expressed similar views at a press conference last week.

Mr. Gao said that China hopes the trade frictions will not escalate, and China will also resolutely defend its legitimate rights and interests. We hope that the United States will be able to work with the China, promote pragmatic cooperation in the economic and trade fields between China and the United States, resolve conflicts in cooperation, erase concerns during development, avoid risks by conducting talks and take concrete actions to maintain the good momentum of the US-China Economic and trade cooperation, ensure that the US-China Economic and trade relations are on the right track, so as to bring more tangible benefits to the people of the two countries.


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