US Ambassador to WTO Says More Countries Need to Pick Sides on China
Dennis Shea, the U.S. ambassador to the World Trade Organization, says that China's interventions in its economy make it incompatible with the rule-based international trading system, and that more countries need to speak out about it. The U.S., the European Union and Japan are working on a common view of what the problems are with China, and what might be done to encourage changes. After that agreement is reached, they will be looking for more allies. Shea warned during a presentation Oct. 12 at the Center for Strategic and International Studies that "friends of the system," as about 40 countries are known in Geneva, "want to be middle-of-the-roaders when they really need to pick a lane."
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Shea, one of the deputy U.S. trade representatives, said that the talks of reforming the WTO -- there are early explorations by both the EU and Canada -- would not be happening if the U.S. hadn't forced the issue. The U.S. has been refusing to accept any nominations to the appellate body, and if that stance continues through the end of next year, the appellate body will not have a quorum and there will be no way to appeal panel decisions on trade disputes. However, Shea did not say that the U.S. will do that if its demands aren't met on changes to the appellate body's practices. "I wouldn't say it's hard and fast that we're not going to support future appointments to the appellate body," he said.
The American complaints about the appellate body are sixfold. Some are technical -- that the rulings are taking longer than 90 days, and that members are deciding to stay on until they finish cases they've been working on. But at the core, the U.S. -- and some others -- feel the appellate body is overreaching its authority by engaging in fact finding, issuing advisory opinions on matters not before them, and adding rights and obligations not in the original General Agreement on Tariffs and Trade (GATT).
Shea noted that the U.S. is engaging at the WTO beyond reform issues. He said the U.S. is engaging on agriculture and on an attempt at reaching a multilateral agreement on eliminating fishing subsidies that encourage overfishing (see 11121624). The WTO is tasked with reaching an agreement on fish by the end of 2019, though there's a little wiggle room, since the next ministerial meeting is in June 2020. "If fish can't be done by June 2020, that does not bode well for the institution," Shea said.