Free Trade Flag-Bearer

By+Mei+Xinyu

SINCE becoming a member of the World Trade Organization （WTO） in 2001， China has seen remarkable growth and become an integral part of the global economy. In a symbiotic relationship， Chinas membership has brought significant changes both internally and worldwide.

In 2016， the latest WTO estimates show world trade will grow slower than expected， an indication that the global economy has yet to fully recover from the debilitating effects of the financial crisis that began in 2008. China continues to be an active contributor to global economic recovery. As a major trading power， China needs to better play its role as a flag-bearer for free trade， resist trade protectionism and fight antiglobalization.

Championing free trade

First of all， the free trade system is essential for global economic stability and growth， especially for China. The United States was the initiator and has been the leading advocate of the worlds multilateral and liberal trade system after the end of World War II. But， currently， China is assuming a leading role as a flag-bearer for free trade.

Although its influence on international trade rules remains strong， the United States has been dragging its feet when it comes to liberalizing multilateral trade or reducing its trade barriers. Instead it has focused its efforts on promoting regional economic groupings excluding major trading powers it sees as threatening.

A case in point is the blatant attempt by the United States to push for a Trans-Pacific Partnership Agreement （TPP） that excludes China. Besides this， calls for protectionism have increased in the United States to an unprecedented level.

For its part， China has chosen a fundamentally different approach. True to its status as the worlds leading trading country， over the past few years China has been lowering its trade barriers on its own initiative and has spared no efforts in seeking to advance the talks at the Doha Round of Trade Talks.

Furthermore， Chinas objective has never been to maintain at all costs its leading trading status vis-à-vis smaller partners. On the contrary， it has used its bilateral and regional free trade agree- ments （FTAs） and its Belt and Road Initiative as ways to open and increase competition in its trading environment. Over the past few years， expanding imports has always been at the top of Chinas foreign trade agenda.

The most telling example of this is the fact that China has entered into FTAs in the past two years with developed and newly industrialized economies whose per-capita GDP is much higher than that of China.

Last year， China announced its FTAs with the Republic of Korea and Australia， which took effect on December 20， 2015. In addition China expanded the range of preferential taxes for imported consumer goods for daily use and cut duties on imported equipment， key components， energy and raw materials from January 1， this year.

As for the TPP agreement， China has repeatedly said that the initiators should ensure the partnership is in line with WTO rules and proposed a free trade area with the European Union.

Fighting protectionism

In view of all this， it is clear that China has shown unwavering resolve to promote a more open and fair trade environment. But maintaining stable growth and sustainable development at home is an absolute precondition for China to remain a convincing and effective free trade flag-bearer. It is also a basic prerequisite for the country to assume a bigger role in the international community.

The WTO has slashed its forecast for international trade growth this year from 2.8 percent to just 1.7 percent. This would be the slowest growth since the financial crisis.

Protectionism， as it often does at times of slug-gish economic growth， is on the rise. The WTO said that since 2008， G20 members have introduced a total of 1，583 new trade restricting measures， while just 387 have been removed in that time.

The United States， the worlds largest economy， has introduced more than 600 trade protection measures against other trading partners during 2008-2016， 90 of which were introduced in 2015 alone， according to the latest Global Trade Alert Reports， provided by UK-based Center for Economic Policy Research.

In contrast， China has continued to intensify efforts to expand imports and prioritized trade facilitation measures. This year only， China has approved seven new FTZs spreading across the country and reviewed regulations on inbound investment to promote negative list mode on a national scale.

Efforts to promote the establishment of a new framework， to restrict trade protectionism， such as a committee of emergency import restrictions， which calls for all or most of the WTO members to participate， must be accelerated. Always sticking to its founding principles， China rejects hegemony and seeks open and fair competition. Far from opposing the TPP， China has maintained that a better solution would be to advance the Regional Comprehensive Economic Partnership on a broader and more inclusive basis.

In addition， China should strive for better coordination among major countries in areas of fiscal and monetary policies with a dual objective： maintaining the worlds economic stability and preventing trade protectionism. China should keep pushing ahead for reform of international economic coordination mechanisms and improved global governance on the basis of equity and efficiency.