[160718.EN.BIZ] US Envoy: WTO No Place to Settle Trade Dispute With China

US ambassador Dennis Shea told a World Trade Organisation meeting that China's unfair trade policies are too big for the WTO to handle.

Washington is threatening 10 per cent tariffs on US$200 billion of Chinese goods. In response, Beijing accused the United States of bullying and said it would complain to the WTO, reported Reuters.

"Given China's very large and growing role in international trade, and the serious harm that China's state-led, mercantilist approach to trade and investment causes to China's trading partners, this reckoning can no longer be put off," said Mr Shea.

"It is clear, moreover, that the WTO currently does not offer all of the tools necessary to remedy this situation," Mr Shea told the two-yearly WTO review of China's trade policies.

Under President Donald Trump, the US has called for that the WTO's dispute system to be changed to prevent the United States from receiving what he regards as an "unfair deal".

To back up his demands, Mr Trump has blocked appointments to the WTO's appeals chamber to replace judges as their terms expire. Unless he relents, the world's trade dispute system will be unable to operate by the end of 2019 or sooner.

Vice Commerce Minister Wang Shouwen defended China's record at the meeting and acknowledged the severe challenges facing the WTO, according to a Geneva trade official.

Speaking before Mr Shea, he called on all WTO members to stand up to bullying, protectionism and unilateralism, and urged them to tackle the systemic threats posed by Mr Trump's tariffs on steel, aluminum and cars, as well as his tariffs directed solely at China.

Mr Shea said the Chinese state's role in the economy had increased. He said foreign firms doing business in China or competing with Chinese rivals faced deeper and broader obstacles, and added that Beijing was providing "massive, market-distorting subsidies" and "skewing the playing field... in a myriad of ways."

The WTO's dispute system focused narrowly on specific policies and could not deal with a broader situation where state-led policies prevailed over market forces. New WTO rules were unlikely to be negotiated to deal with the situation and would in any case take too long.

Source : HKSG.