Chinese ex-vice minister slams US for putting WTO at risk of being ‘irrelevant and non-existent’
- Zhu Guangyao says World Trade Organisation is in ‘real danger of being suspended’ after move to block appointment of new judges to Appellate Body
- He tells international relations forum in Beijing that a path needs to be found to uphold the principles of free trade and equality
A former senior Chinese finance official on Monday slammed the United States over its move to stymie the World Trade Organisation, saying it had put the international body at risk.
“On December 10, because of the unilateral blocking by the United States, the appeal mechanism of the WTO had to be suspended, and the function of the WTO is now facing a real danger of being suspended,” Zhu said during an international relations forum at Renmin University of China in Beijing.
“The WTO risks becoming irrelevant and non-existent,” he said. “So how can international trade be further developed? I think it will take the collective efforts of all 164 member states.”
The WTO’s Appellate Body has the final say on trade disputes heard at the Geneva-based organisation and it requires a minimum of three judges to hear cases. It has disintegrated after the tenure of two of its final three judges expired.
It is considered by many to be the WTO’s most effective mechanism, since its rulings can result in tariffs being placed on contesting member nations, meaning it is viewed as a deterrent against unilateral protectionism.
With the US blocking the appointment of new judges, allowing the number to dwindle from seven, it can no longer function.
Zhu, who was involved in the US-China Strategic and Economic Dialogue when he was still in office, also said a path needed to be found in the WTO – agreed by all parties – to uphold the principles of free trade and equality and to inject new energy into global trade, without elaborating.
He said the 2008 global financial crisis originated in the US and was only overcome with the collective efforts of the international community.
“We cannot forget that the crisis was one that originated from the US … the bankruptcy of Lehman brothers sent shock waves across the US financial markets and global markets,” he said.
Zhu noted that this was the background against which the first Group of 20 leaders’ summit was held in 2008, adding that it played a huge role in the coordination of financial and monetary policies of major economies.
“Ten years has passed and the world is yet to move out of the shadow of that crisis, yet some countries have forgotten the lesson,” he said, without elaborating.
“Unilateralism and protectionism have forced a halt to the coordination of macro policies in the international community,” he said.
