Former WTO chief: US trade war against China ‘just failed’ – Community News
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Former WTO chief: US trade war against China ‘just failed’

Editor’s Note: Pascal Lamy is the former director-general of the World Trade Organization, now the president of the Paris Peace Forum. What role is China expected to play in the international arena as China celebrates its 20th anniversary of its accession to the WTO? And with Tuesday’s virtual China-US meeting, are we finally seeing the proverbial silver lining?

Pascal Lamy: In general, China’s accession to the World Trade Organization is a win-win situation.

Wang Guan: Where do you see the rivalry between China and the US, as you put it, going?

Pascal Lamy: I think when I look back at Trump’s trade policy towards China, it simply failed.

Wang Guan: Where is the WTO in all this?

Pascal Lamy: We need new rules to tackle climate change and digitalisation. And this will not happen without the US, China and the EU.

Wang Guan: The Chinese and American leaders met virtually from each other’s capital. What will you take away from this meeting? What messages have you picked up?

Pascal Lamy: I think the most important message is that President Xi Jinping and President Biden are talking to each other. And I think it’s good that they talk to each other as often as possible or necessary. Given that we are now in a period of growing rivalry between the US and China and will remain so for some time to come. So the more often they speak, the better it is to keep this rivalry under control and prevent it from turning into a conflict. So I think overall this is a positive sign.

Wang Guan: But in the medium and also in the long run, where do you see the rivalry between China and the US, as you put it, heading? Do you think this will be a benign and healthy rivalry, a race to the top, if you will; or a continuation of the Trump-era “trade war” against China in what appears to be a race to the bottom… that sort of thing?

Pascal Lamy: I don’t think the trade side of the US-China relationship is the most important dimension. The main dimension is about safety. It’s about strategic issues and it’s about the US worrying about the relative growth of China’s importance in the world. But it is also true that geopolitics is more important in the digital age than in the old economy. And especially because of the sensitivity of the big data, because of cybersecurity concerns, so there is some implication of geopolitics and geoeconomics in the digital age. And this is something that links this rivalry to trade, although not in the Trump way. I think when I look back at Trump’s trade policy towards China, it simply failed. It was wrong to do. It failed as proof by the numbers and by the way I don’t think if the US strategy is to isolate China it will work.

Wang Guan: You are talking about rates. US Treasury Secretary Jennet Yellen said in an interview that the US is considering cutting tariffs on Chinese goods. And we all know it’s been 3 years since Donald Trump launched the “Trade War” against China. Do you think the US should cut rates or maybe cancel?

Pascal Lamy: I think anything that distracts the US from this wrong trade policy that President Trump has had is a good thing. There are high tariffs on the US side for imports from China. There are high tariffs on the Chinese side for imports from the US. A reduction in this would, I think, be a good contribution for both the countries and the rest of the world.

Wang Guan: But do you think Joe Biden can convince his backers, especially those in the so-called “rust belt area”? If you go to Michigan, Minnesota and Texas, those farmers and industrial workers don’t necessarily benefit from world trade.

Pascal Lamy: I believe Trump’s trade policy has not been good for the US – it’s bad for the US, it’s bad for China, it’s bad for the world. Some constituencies that don’t like foreign competition may like protectionism – this has always been the case. In matters of trade policy, trade opening generally works, but with some winners and losers. And the trade opening losers prefer protectionism — it always has — which is why President Biden’s room for maneuver over his own domestic constituencies to deviate from Trump’s protectionist policies is inevitably limited. .

Script: Wang Guan, Deng Yutong

Editors: Liu Shasha, Deng Yutong

Designer: Qi Haiming

Producer: Zhao Yunjie

Supervisor: Mei Yan

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