Since China joined the WTO and integrated into the great circle of the global trade, China has not only enjoyed various benefits brought by the opening-up but also met severe challenges and pressures, including dealing with various trade disputes and frictions.

Learning and using WTO rules to better participate in the competition and pursuing a mutual-benefit situation by using bilateral and multilateral coordination systems are good strategies for China to deal with the trade disputes and frictions.

The WTO judged on June 8 that the United States’ action of using the “returning to zero” method to calculate the dumping margin of the enterprises in its anti-dumping investigation on the warm-water shrimp and diamond saw blade imported from China does not accord with the rule of the TWO, and China won the case completely. It was China’s another victory of solving the trade dispute by using TWO rules.

In the 10 years after China joined the TWO, a total of 690 anti-dumping, anti-subsidy and anti-special safeguard cases against China were launched, involving 40 billion U.S. dollars. Since the international financial crisis broke out in 2008, the global economic recovery has been slow and gloomy, the trade protectionism has been strengthening, and trade frictions have been increasing. In 2009, China met most trade frictions, including more than 100 cases with 12 billion U.S. dollars involved. Both numbers had doubled compared to those of 2008. In 2012, since economic situations of some countries keep gloomy and the trade protectionism is heating up, the trade frictions faced by China are also increasing.

Learning and using WTO rules to better participate in the competition and pursuing a mutual-benefit situation by using bilateral and multilateral coordination systems are good strategies for China to deal with the trade disputes and frictions. In past 10 years, Chinese enterprises has changed from daring not to respond to the lawsuit to being active to respond to it and from passively responding to the lawsuit to actively safeguarding their legal rights and interests by using legal channels.

Facing trade frictions, enterprises of Shenzhen have a lawsuit responding rate of 100 percent. In addition, China also has launched about 190 anti-dumping, anti-subsidy and anti-special safeguard cases, which have effectively protected Chinese enterprises’ legal rights and interests.

China also deals with trade frictions and pursues common interests by using bilateral and multilateral channels, organizing cooperation among the government, industry and enterprise and holding negotiations and has achieved positive effects. After the international financial crisis broke out in 2008, China’s foreign trade, protected by multilateral trade rules, has realized a rapid development. China’s market share has expanded and the share of China’s export in the global export had increased from 9.1 percent in 2008 to 9.9 percent of 2009.

Experts said that, without using WTO rules as weapons, China’s industries would have suffered a much greater loss caused by the trade protectionism after the international financial crisis broke out.

China launched a formal complaint in Geneva on May 25 requesting consultations under the WTO dispute settlement mechanism concerning U.S. countervailing duties over 22 categories of Chinese products. At the time, a Ministry of Commerce spokesperson reiterated the Chinese government’s stance that all WTO members should abide by WTO rules. The Chinese government opposes the abuse of trade remedy measures and protectionism as well as trade wars. China will exercise its rights of WTO membership, and safeguard the lawful rights and interests of domestic industries and companies, which is conducive to the healthy development of international economic and trade relations in the long run.

China has gradually evolved from a new WTO member and a simple participant into a mature member and a facilitator by learning and using international rules. During the process, the country has played an active and constructive role in formulating international trade rules. China will continue to work with other developing countries to push the multilateral trading system and international political and economic order toward greater fairness and efficiency.

The aftermath of the global financial crisis remains, and the deep-rooted problems hindering global economic growth have not been completely solved. Competition in international markets is becoming increasingly fierce amid a rise in protectionism around the world. Facing the complex international situation, China should make good use of WTO rules to protect the lawful rights and interests of domestic industries, and actively participate in formulating international trade rules while fulfilling obligations. In addition, the country should improve its soft power in various areas such as core technology, intellectual property rights, and rule formulation, and enhance the quality of its export-driven economic growth.

Source: Economic Daily, Author: Li Yuyang