Should the World Trade Organization Crack Down on China for Its Protectionist Policies?

Issue: Should the World Trade Organization crack down on China for its protectionist policies?

World Trade Organization (WTO) is an organization that intends to supervise and liberalize international trade, deal with regulation of trade between participating countries; it provides a framework for negotiating and formalizing trade agreements, and a dispute resolution process aimed at enforcing participants’ adherence to WTO agreements. Main function is to ensure that trade flows as smoothly, predictably and freely as possible. WTO has 155 members and 27 observers, including China as a member since 2001. WTO adheres to five principles which are;

1. Non-discrimination:

-The most favored nation (MNF) rule: WTO member must apply the same conditions on all trade with other WTO members.

-The national treatment policy: Imported goods should be treated no less favorably than domestically produced goods for example no non- tariff barrier to trade.

2. Reciprocity: Mutual tariff reduction

3. Transparency: Clear unambiguous trade measures

4. Fairness: Restrictions on dumping goods

5. Valve Safety

The reasons why WTO should crack down on China protectionist policies are:

1. China’s policies violate WTO rules.

As WTO main objective is to create smoothly and freely trade flow, China protectionist and weak on intellectual property is violate WTO policy (non-discrimination). Furthermore China policy may lead to trade war between nations so as the center organization, WTO should treat all countries equally. WTO intervention will increase the benefit of members as a whole.

2. China’s policies affect world economy

- Import tariff: One of trade barriers that hinder the ability of the fair trade between countries is import tariff. It is true that imposing high percentage of tariff could somehow protect local companies from foreign competitors that would come to compete in China. However on the other hands, tariff can causes a net loss to the economies of both the country...