The contents of this article are written with authoritative materials and personal opinions. The source of the literature has been marked at the end of the article, so please know.
The Preface:
At this session of the UN General Assembly, China announced a "shocking" news to the world: we will not continue to seek new special and differential treatment in future negotiations.
In other words, it would formally abolish all special treatment given to developing countries by the WTO.
China is still a developing country at present. What is the reason for this? How does this help Sino-US economic competition?
Since Trump's last term, U.S. presidents and lawmakers have been clamoring for the cancellation of China's "two special treatments" internationally.
One is the “permanent most favourable treatment” granted by the United States.
During the Bush administration, China and the United States signed this decisive document for the future, allowing the two countries to offer each other preferential conditions in trade without discrimination.
However, with the development of China in recent years, the U.S. trade deficit with China is getting bigger and bigger, and these politicians don't intend to accept the account and try to cancel the special rights and interests granted to China by the "most-favored-nation treatment".
This is not only being promoted during Trump's term of office. After Biden took office, the United States is also preparing to change its "gameplay", but it is not easy to cancel the "most-favored nation" designation.
In March 2023, the U.S. House of Representatives made a special drama:
A vote on "not recognizing China as a developing country" was launched, and the vote result was one-sided 415: 0, so it was passed.
This is actually the first step to the abolition of the “most-favourite treatment.”
It is still not easy for the United States to have such a "clear" voting outcome in an era of such a split between the two parties.
At the time, the United States demanded the abolition of China's second "special treatment", which was recognized in the WTO as a preference for developing countries.
In fact, this is a provision in the internal provisions of WTO. On the premise of global trade balance, developing countries can be given some Generalized System of Preferences (GSP) treatment.
Such as non-reciprocal tariff preferences, increased deadlines for implementation of agreements, and so on.
China, as a developing country, should naturally enjoy these basic terms just like any other country, there is nothing to question.
The U.S. government has called on the world to “change its view of China.”
They made it clear that China’s current economic strength, its leading level in trade and its position in the world could not be counted as developing countries, and other countries should also change their recognition of China.
The votes at the time only constrained themselves, but now they are ready to extend their hands to other countries.
In the past few years, many countries in Europe and America have been clamoring for "promoting the abolition of preferential treatment for China". However, they can't amend the WTO terms, so they can only shout slogans.
On the 22nd, the Chinese delegation read out a new message in public at the UN General Assembly: China will not seek new special and differential treatment in the current and future negotiations of the WTO.
That is to say, without the “hurry” of the Western countries, now China automatically gives up this multilateral preference.
China has also said it will only give up special treatment issues in all new agreements in the future.
That is to say, all previously signed agreements are still valid, and the preferential treatment for China will not be affected in any way.
Why is China now giving up this special treatment, has it escaped the recognition of developing countries?
On the 24th, Li Chenggang, Vice Minister of Commerce, gave an explanation, summarized in three words: important measures to firmly safeguard the multilateral trading system and actively implement global development initiatives and global governance initiatives.
Li Chenggang particularly emphasized one problem: China will not change the "definition" of the world's largest developing country.
First of all, China’s decision has countered the West’s so-called “low-cost” illusion.
As stated above, Western countries, led by the United States, have been pushing the issue of preferential treatment aside, and have been advocating that other countries and the Chinese side signed the agreement "injurious",
In the end, we need to take the "contrary" of the size and preferential conditions of China's economies.
China has proactively declared that it does not seek new special and discriminatory treatments, and has responded to these absurd statements with practical action, directing pressure on those countries that are responsible for development issues.
More importantly, through this "abandonment", we have directly become the leader, creating conditions for participating in global economic and trade governance as a "high status".
In other words, China is honest, and on the premise of no longer focusing on its own special treatment demands, it will more vigorously push negotiations to tilt towards development-oriented results and help other developing countries exchange convenience clauses.
If these preferential treatments are still pursued in trade agreements, it may lose more mutual trust with other countries. Comparatively speaking, China should seize the opportunity to improve its trade status.
Secondly, even China's "strength" allows it to do so. The current situation is quite different from that when China first joined the WTO in 2001.
It can be said that after years of development, China's current volume and development momentum have the ability and confidence to assume international responsibilities that are compatible with its development level.
This has nothing to do with China’s status as a developing country, and the “role” played in the economies can be further enhanced.
Not seeking new special and differential treatment, it also means that China will rely more on rules, innovation and strength negotiations to safeguard its rights and interests.
This is also highly consistent with the objectives of promoting Chinese-style modernization and expanding high-level opening-up.
Another point is that the response of the Ministry of Commerce mentioned that "the multilateral trading system is facing severe challenges" at this stage, including that some countries are destroying the global economy through unilateral bullying and tariff wars.
What is said here is obvious, and most importantly, after Trump came to power this year, the various actions of the United States can be said to be "one over one",
Now, regardless of opponents and allies, tariffs are imposed on most countries around the world.On this basis, countries need to find multilateral trade rules. “The Stones”。
China actively renounces preferential treatment by entering the country, making it clear to the world who can be trusted trade objects, which can have a critical impact on the competition between China and the United States.
Looking back at China's accession to the WTO in 2001, there have been many conditions for "principled concessions". When negotiating agreements with other countries, it has lowered the threshold of conditions many times.
Actions such as promoting reciprocal tariffs with other countries and helping poor countries to trade local currency swaps have set up a “A credibility mark.”。
Now, under the "tariff storm" launched by the United States, China has exchanged concessions of differential treatment for the trust and respect of all countries.
It is an absolutely valuable action compared to losing its credibility for the sake of the United States.
References:
"Ministry of Commerce: China will not seek new special and differential treatment in WTO negotiations" China News Network
China's announcement that it will not seek new special and differential treatments from the WTO will bring new opportunities and new impetus to global economic and trade cooperation.
WTO Director-General: China's decision reflects its commitment to a more balanced and fair global trade system