Commentary RESEARCH

How the U.S. is breaking the global trading order in the name of protectionism

Elena

2023-02-06 12:00

BEIJING REVIEW

Recently, members of the World Trade Organization (WTO) denounced the United States for its abusive series of appeals against the global trade watchdog's panel rulings over its import tariffs and flawed labeling of goods' origins. As such, they urged the country to fulfill its obligations as a WTO member and stop its unilateral and protectionist moves, according to reports. 

By blocking the appointment of new judges since 2019 and preventing the appeals process from functioning, the United States has effectively paralyzed the World Trade Organization as a governing body by using its right of appeal to block any rulings against it, meaning that "appeals cannot be processed, and related rulings cannot move forward."

While the United States calls for reform of the WTO, its real motivation, in keeping with the actions pushed forward by the Trump administration, is protectionism. It no longer believes in fair and free trade. Rather, it seeks to aggressively shore up its advantages by willfully undermining the global trading order in the name of "America First."

Starting with the U.S. Deputy National Security Advisor, Matthew Pottinger, the U.S. devised a blueprint that linked its trade with its so-called national security. Despite having promoted free trade and open markets for decades and having promoted this ideology in the name of spreading American "values," the U.S. has come to the conclusion that such arrangements are no longer in fact in the national interest to sustain.

In other words, as once confidently assumed, free trade did not remake the world in America's image but "empowered" rival countries, instead of transforming them. The U.S. then came to believe these undermined the unilateralist hegemony that it once deemed to be inevitable. This led to the Trump era level of logic that free trade "ripped off" the United States and established a new consensus of protectionism focusing on "bringing jobs back" to America. While this was seen as largely populist rhetoric directed toward Trump's supporters, the circumstances of its emergence also had a clear geopolitical element too.

Thus, in line with Trump's rhetoric, the United States changed its foreign policy strategy, which much to the surprise of many was doubled down on by Biden, seeking to dismantle globalization in the name of "America First," pursuing protectionism with the goal to politicize, strategize, and weaponize trade. The U.S. wants to be able to gain control of key global supply chains, such as high-end chips, semiconductors, renewable energy goods, and energy, etc., seeking to re-establish them in America, forcing the dependency of allies upon them while excluding competitors from the market.

The United States is using a number of perverted means to achieve these goals. They typically involve baselessly branding things a "national security threat," such as how it has treated certain Chinese companies, or by weaponizing "human rights" rhetoric to smear companies or products so as to try and exclude them from the market on legal grounds, such as what is done to Chinese cotton, polysilicon, and solar panels.

While Washington primarily uses geopolitical conflict to force "decoupling" between its allies and target countries, it also uses a variety of other coercive means to enforce its will on third parties, including sanctions, tariffs, and large-scale subsidies, the latter two of which have caused serious harm to Europe. Despite the World Trade Organization is in theory an arbiter of the rule-based system it once created, America's attempts to hobble the organization are deliberately designed to place it beyond accountability and to gain an unfair advantage. That is why other countries cannot challenge it.

According to reports, 127 WTO members have attempted on 61 occasions to start the selection process for filling vacancies in the Appellate Body. Nevertheless, the United States has blocked the proposed decision. This has rendered international law on trade toothless and is a clear representation of how the U.S. is breaking the free trade system for its own geopolitical gain.

This is the world we now live in, one plagued with growing uncertainty and insecurity in the name of U.S.-led geopolitical conflict and protectionism. The countries of the world must work together to preserve rule-based free trade order and protect it from those who seek to destroy it, which ultimately means engaging with China and resisting coercion to follow U.S. unilateralism.

The author is a British political and international relations analyst and a graduate of Durham and Oxford universities.  


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