Editorial | The WTO must stand its ground against White House bullying
- While Washington’s case for changes to the WTO’s classification system for developing economies is not without merit, its threats and ultimatums are unacceptable
There is difficulty finding a multilateral body Donald Trump likes. The American president who ran his election on “America First” is happy to trample over global institutions even when set up with the help of his own country to create a rules-based international order.
His latest attack is on the World Trade Organisation and its system of classification and trade preferences for “developing countries”. His primary target is China, which he claims has long gamed the system by using its “developing economy” status.
Among key US complaints is that China exploits its special treatment under WTO rules to use tariffs and export subsidies to protect its own industries. Practically everyone, even China, agrees that the WTO needs to be reformed. But it has to be carried out within a multilateral framework and built on the consensus of members, not on the say-so of Washington. Otherwise, what is the point of having the WTO?
Even so, Washington’s case is not without merit; what is questionable is the way it is being pursued. Given China’s sheer size and rapid pace of economic development in recent times, any simplistic classification is bound to paint a misleading picture. By some measures, China is clearly developed; by others, it has a long way to go.