Home World Xie Tian: European and American countries have successively abandoned the CCP’s WTO phantom tools | Generalized System of Preferences | Most Favored Nation Treatment | European Union

Xie Tian: European and American countries have successively abandoned the CCP’s WTO phantom tools | Generalized System of Preferences | Most Favored Nation Treatment | European Union

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[Epoch Times November 05, 2021]The world entered the middle of September of the Xin Chou Year, and the international situation is undergoing rapid changes almost every day. More than 30 countries including the European Union almost quietly abolished China‘s GSP tariff preferential treatment, but the CCP was silent and did not report it at all. It only quietly issued a notice at the customs. This is almost a world apart from the clamor when China joined the WTO and received the most-favored-nation status of the United States! What is the most feared by the CCP? Countries have abandoned the CCP one after another, making China‘s reputation in the World Trade Organization false. What does this mean?

How the CCP suddenly lost the favor of European countries, I am afraid the CCP itself is not completely clear. The official response of the Chinese Communist Party, in other words, was almost unresponsive, dumbfounded, and even more thought-provoking. When countries abolished the preferential tariff treatment of the GSP to China, they did not mention the World Trade Organization (WTO). It seems that this matter has nothing to do with the WTO. But in fact, this matter has too much to do with the WTO, almost fundamentally, but both parties are pretending to be deaf and dumb, and this is a huge mystery in itself.

The Communist Party of China is indeed becoming more and more angry and resentful. The 27 member states of the European Union plus 32 countries including the United Kingdom, Canada, Turkey, Ukraine and Liechtenstein will start on December 1 this year (2021). Cancel the most-favored-nation trade status granted to China. In addition, Reuters reported that the United States and the European Union have also ended their steel and aluminum tariff disputes, saying that they will formulate a plan to combat the “dirty production process” and “overcapacity” of the steel and aluminum industry. The statements of the two parties did not name China, but China produces more than half of the world‘s steel, which is precisely the target; China‘s environmental pollution and dirty production at all costs have long been known to the world.

China enjoys most-favored-nation status (MFN) in international trade, especially the most-favored-nation status of the United States, which began in 2000 during the time of US President Clinton (Bill Clinton). In December 2001, the United States agreed to China‘s accession to the World Trade Organization (WTO). But 20 years later, the European and American countries where cutting-edge technology was stolen, burdened with huge deficits, millions of jobs were lost, and bruised all over, finally began to realize that the CCP’s promises were nothing but empty promises. In my opinion, the last straw that led to the EU’s abrupt termination of China‘s preferential tariffs was the lie that the CCP declared not long ago that China has fully fulfilled its commitment to the WTO!

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The Generalized System of Preferences refers to the preferential system of tariffs granted by developed countries to the export of manufactured and semi-manufactured products from developing countries and regions. It is based on the most-favored-nation tax rate and further imposes import tariffs. Relief. However, with the development of China‘s economy, Switzerland and other countries have cancelled the most-favored-nation treatment for China in 2014; Japan also announced the cancellation of this treatment in 2019; by this year, Russia and Kazakhstan have also announced the cancellation. In mid-October this year, China announced that it would no longer issue GSP certificates of origin for goods exported to Russia, Kazakhstan, and Belarus, because these countries have cancelled the most-favored nation status for China.

The United States, originally under President Trump, was the first country to launch a trade war against the CCP. However, this year, the United States has slowed down its economic and trade policies against China, and now the European Union countries have taken the lead. As early as March of this year, the U.S. Senator from Arkansas, Tom Cotton of the Republican Party and many other senior congressmen proposed the “China Trade Relations Act”, calling for the abolition of the “permanent status” enjoyed by China (the Chinese Communist Party). Sexual Normal Trade Relations (PNTR) status means that China’s permanent most-favored-nation status will be revoked and returned to the pre-2001 system. Will the US Biden administration soon join the 27 EU countries and also cancel the most-favored-nation trade status granted to China? Judging from the current trend of the CCP’s decline and the onset of its collapse, coupled with the CCP’s own stance of frequent war wolves, flaunting power, and preparing for war, the complete separation of the international community and the CCP is a high probability event. Of course, there are still foreign policy considerations of the Democratic Party government.

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The abolition of preferential tariff treatment for China by many European countries this time will not have a very limited impact on China’s overall export trade, as some Taiwan and Hong Kong experts believe, but will affect many mainland China’s low gross profit and labor-intensive labor. Industry. Moreover, such an impact will accelerate the migration of these affected industries to other countries such as Vietnam and Africa. As a result, China‘s already severe employment situation will become even more severe.

The crux of the problem may lie in the WTO itself. According to the provisions of the World Trade Organization (WTO), accession to the WTO means a series of commitments, including recognition of the WTO’s requirements, that is, all member states must extend unconditional the most-favored-nation trade (MFN) treatment of other member states. This so-called Most Favored Nation (MFN) treatment is now called “Permanent Normal Trade Relations” (PNTR) in the United States. Only in this way can these countries enjoy the full benefits of WTO members.

The absence of the head of the CCP government at the United Nations Climate Change Conference in Glasgow is of course that CCP leader Xi Jinping is afraid of being attacked by the heads of other countries, but also wants to avoid the embarrassing situation of CCP officials lacking a foreign language foundation and difficult to communicate privately and face-to-face with leaders of other countries. But there are also factors that make the CCP increasingly incompatible with the international community and increasingly excluded from the normal international society. From the perspective of the West, especially today’s international leaders with the left as the mainstream, the fact that the CCP does not participate in such an “important” international climate commitment can only show that the CCP has no willingness to seriously participate in, commit to, and implement emission reductions. The Chinese economy is currently in a deep plight, and various coal mines and mines have been shut down and opened in a hurry, making it even more difficult for the CCP to achieve its goal of reaching its peak in 2030 and reaching neutrality in 2060.

In fact, the legally binding agreements signed in Paris six years ago by 196 countries including the United States, Russia and China are now facing difficulties. The basis of this year’s summit is the commitment of these countries to reduce emissions in the Paris Agreement, and strive to control the increase in global climate temperature within the range of 1.5 degrees Celsius before industrialization. However, it is difficult for China to fulfill its promise, and India announced that it will not achieve net zero emissions until 2070, 20 years later than the original target.

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The CCP’s commitments on international climate issues, in the eyes of the international community, may be as vague and unreliable as its commitments in the WTO. This may be one of the reasons why the international community’s attitude towards the CCP has changed.

The 27 EU countries, plus the United Kingdom, Canada, Turkey, Ukraine, and Liechtenstein, a total of 32 countries, plus Japan, Switzerland, Russia, Kazakhstan, and Belarus, as well as the United States, which is imposing trade war tariffs on China, China is currently facing the tariff barriers of almost all major economic powers, including North America, Europe, Asia, Eastern Europe and other nearly 40 countries. The preferential tariffs that China has enjoyed for more than two decades have almost disappeared! The blow of this important trend to China‘s foreign trade exports will be fatal and of far-reaching significance. This is almost tantamount to saying that China’s membership in the WTO has been in vain and has no real meaning.

What is even more strange is that the CCP has almost no power to fight back against the encirclement in nearly 40 countries, nor dare to condemn it in a big way at home. Instead, it has adopted the method of calming down and pressing down. Other countries did not make any special announcements, but quietly closed the door to Chinese products. It is believed that the latest economic and trade development in the international community in the next few months will trigger even greater after-effects, and the huge impact on the Chinese economy may have just begun.

(Dr. Xie Tian is Professor of Marketing and John Olin Palme Chair Professor at the Aiken School of Business, University of South Carolina, USA)

Editor in charge: Zhu Ying#


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