US trade protectionist
US trade protectionist

The trade protectionist move unilaterally taken by the US will severely undermine free trade and global economy, Chinese and foreign experts warned amid the rising global attention to the US’s so-called Section 301 investigation into Chinese products.

The US’s resort to domestic laws in dealing with international trade frictions is against international rules, they pointed out.

“The investigation, initiated, surveyed, arbitrated and implemented by the US, is extremely unilateral,” said Bai Ming, deputy director of the International Market Research Institute under China’s Ministry of Commerce, adding that the investigation has been opposed by the world since it was announced.

Chad P. Bown, a senior fellow at the Peterson Institute for International Economics in Washington, compared the US in the Section 301 investigation to police who judges whether a foreign government is right or wrong, a prosecutor who files a lawsuit, a jury that identifies evidence and a judge who decides whether to take retaliatory actions.

In the 1980s and 1990s, the US frequently launched Section 301 investigation against its trade partners including Japan, the EU, Canada and Brazil. But after the establishment of the World Trade Organization (WTO) in 1995, the outdated investigation was rarely adopted.

Industry insiders pointed out that many investigations recently launched by the US, including the Section 301 one, though distinct in the content, are mostly of strong unilateralism and related to the trade law of the US enacted in the Cold War. They were barely used after the establishment of the WTO.

The US’s move to handle economic and trade issues by activating these investigations and using the outdated legal tools have aroused wide concerns, according to the insiders.

“The US can appeal to the WTO for arbitration, but it cannot unilaterally announce sanctions. If the country skips the WTO, then it violates the principles of the organization,” said Tu Xinquan, a professor with the University of International Business and Economics in Beijing.

The US was one of the major makers of international trade rules, but it has become an obvious breaker by its recent practices, said Zhu Min, chairman of the National Institute of Financial Research, Tsinghua University.

Undoubtedly, the US’s behavior will harm both China’s and its own interests, and more severely, it will damage the global value chain, Zhu added.

According to the WTO ruling and the commitments of the US, the US should not decide whether the other WTO members are against rules or not based on the Section 301 investigation. Instead, it must resort to WTO rules and the Dispute Settlement Body in handling issues involving WTO agreements, said Zhang Xiangchen, Chinese ambassador to the WTO.

The US has violated its “explicitly, officially, repeatedly and unconditionally confirmed” commitments in DS152, a dispute related to Section 301 lodged by the European Communities, Zhang added.

Global coordination and common prosperity have become a shared consensus and a common goal for the world. Under this backdrop, the US’s unilateralism, which is disrespectful of common rules, is very incompatible with the times.

“The US’s unilateral move has not only harmed the interests of China and other WTO members, but also severely damaged multilateral trade mechanism,” Zhang pointed out.

Unilateralism completely goes against the WTO, Zhang said, adding that concerted efforts are needed to stop the revival of the Section 301 and keep it within the framework of WTO rules.

By Wang Ke

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