How did China end up posing as the defender of global trade?

CNN/Stylemagazine.com Newswire | 4/10/2018, 8:25 a.m.
The United States was the architect of the rules that govern global trade -- but these days, it's China that's ...
President Donald Trump

Jethro Mullen

(CNN Money) -- The United States was the architect of the rules that govern global trade -- but these days, it's China that's positioning itself as the defender of the system.

As President Donald Trump has gone on the offensive against China in an attempt to push it to abandon trade practices many companies and governments say are unfair, Beijing has sought to portray the US moves as an attack on the international trading system as a whole.

"It's been clear for all to see that the China-US trade dispute is a conflict between unilateralism and multilateralism as well as between free trade and protectionism," the People's Daily, the official newspaper of China's ruling Communist Party, said in a commentary published online Tuesday.

"Many countries can't stand the arrogance and going-it-alone attitude of the United States on this issue."

Experts says it's a bizarre state of affairs, given China's own track record on trade.

"China is seeking to cast itself as the defender of a rules-based system, but its own past behavior raises doubts about just how committed China is to following the spirit, if not letter, of the law," said Mark Wu, an international trade professor at Harvard Law School.

Beijing's efforts to stake its claim to the role were again on display Tuesday when President Xi Jinping delivered a speech vaunting the benefits of free trade and globalization for China and the world. He said countries must work together to promote greater liberalization and to support "the multilateral trading system."

China 'gaming the system'

China has good reason to defend the status quo. As Xi outlined in his speech, entry into the World Trade Organization in 2001 helped spur China's spectacular economic rise that lifted millions of people out of poverty.

Trump sees China's gain as America's loss.

Trump said last week that the WTO gives "tremendous perks" to China and is "unfair" to the United States, the latest in a series of attacks on the body that administers the rules of international trade and seeks to resolve disputes.

Experts say that as China has become more integrated into the global trading system, it has gone along with many -- but not all -- of the requirements.

Beijing "still regularly flouts some of its commitments and utilizes the gaps in the system to officially stay inside the lines. China has learned to game the system about as well as anyone," said Scott Kennedy, an expert on the Chinese economy at the Center for Strategic & International Studies in Washington.

"However, as China has grown and its gaming of the system shifts larger and larger costs to others, the world has become less patient with this state of affairs," he added.

Many of Trump's criticisms of China tally with those of other governments and complaints from international companies. But rather than build a broad coalition Trump decided to go after China alone without following WTO procedures, abandoning the legal high ground.