International Relations
US-China Move to WTO
- 03 Sep 2019
- 2 min read
Recently, China has lodged a complaint at the World Trade Organization (WTO) over raised import duties by the US.
- The US has recently imposed 15% tariffs on a variety of Chinese goods. In retaliation China imposed new duties on US crude oil, escalating the trade war between the two.
- Around $300 billion of Chinese exports are expected to get affected by this move of the US.
- The latest tariff actions violate the consensus reached by the leaders of China and the United States in a meeting in Osaka.
At WTO
- This is the third legal suit filed by China at WTO challenging US protectionism policy against Chinese exports.
- The US defended its move by claiming that it is penalizing China’s distortive technology-transfer policies.
- Also, these measures were necessary to protect public morals- a clause that was used in the past to argue for trade restrictions over gambling, animal rights, and public broadcasting.
- The Intellectual property (IPR) rules are not covered under WTO.
- Under WTO rules, the US has 60 days to try to settle the latest dispute with China. Then China could ask the WTO to adjudicate.
Way Forward
- China’s decision to fight fire with fire without WTO’s approval just escalates the trade tensions between the two nations.
- If the United States is found to have broken the rules, China with WTO’s approval can retaliate against the trade sanctions.
- Even though it is a lengthy and time-consuming process, the settlement of disputes through international conventions and rules is the need of the hour.
