Trump’s flawed strategy on how to deal with the WTO
Rather than seek to undermine the World Trade Organisation, the American leader should look for ways to strengthen it
China is not the only target of US President Donald Trump’s protectionism; he also has the World Trade Organisation in his sights.
To the American leader, the two are intrinsically linked, the latter to blame for the benefits he perceives as having been unfairly given to the former. But his thinking ignores the advantages of a globalised trading system, with rules for fair play and mechanisms for dispute resolution.
Shunning the established order and taking unilateral action by imposing tariffs neglects the reality that Beijing will respond in kind and if there is a trade war, neither country will win.
Trump’s views were clearly on show in a social media posting last week that took aim at the WTO for treating China, which he referred to as “a great economic power”, as a developing nation. “They therefore get tremendous perks and advantages, especially over the US,” he tweeted. “Does anyone think this is fair?”
His line towards both has been consistent since before he took the presidency 15 months ago, but rather than use the organisation’s mechanisms to work for a solution, he has turned to rhetoric, protectionism and a policy of obstruction.
There are growing fears that he intends to go further, tearing apart the rules that have fared the world so well. President Xi Jinping defended globalisation and open markets in his keynote speech at the Boao Forum for Asia and the Chinese ambassador to the WTO last month called on members of the organisation to defend it from being wrecked by the US.