Washington's unilateral protectionist measures against China run counter to WTO rules: U.S. scholar

Updated 2018-04-25 10:50:02 Xinhua

The unilateral trade measures against China by U.S. President Donald Trump's administration run counter to World Trade Organization (WTO) rules and procedures, a U.S. scholar said Monday at a panel discussion on U.S.-China trade relations.

Donald J. Lewis, adjunct professor of the Department of Economics, Law and International Business at the University of San Francisco, said it was a "perilous moment" with the Trump administration threatening to impose steep tariffs on billions of dollars of Chinese exports.

Addressing the panel held on the university campus, Lewis called the tariffs "clearly dangerous".

"They run counter to established WTO rules and procedures, (and) essentially violate the most favored nation clause of the General Agreement on Tariffs and Trade... which is very fundamental to our global trade system," he said.

"Given the U.S. and Chinese economies are essentially going to be highly interdependent, the consequences of a protracted trade war could be devastating," Lewis said.

While the two countries have divergent models of economic development, Trump's protectionist measures result from the fact that "the U.S. has been less than effectual in responding constructively to China's rise" as a global economic power, the scholar said. To some extent, Trump's reaction to China reflects Washington's concern at Beijing's possible technological lead.

That's why the U.S. tariffs are targeting items included in the "Made in China 2025" policy, he said.

The initiative seeks to upgrade 10 key hi-tech sectors that range from artificial intelligence, chips, automotives and information technology to advanced biology technology.

Calling the tariffs a means to "retard China's ability to develop these sections and compete with the U.S.", Lewis said it's not constructive strategy.

"We should be engaging more with China rather than calling ourselves off from cooperating with China," he said.

Kenneth Petrilla, managing director of ChinaVest Ltd., a 25-year-old investment and advisory company in California, said there won't be any winner in a trade war between the United States and China, which will impact not only the two countries but also the global economy as a whole, which is interwoven now.

"If we have a trade war between the U.S. and China, the EU and global economy will suffer as well," he cautioned.

One of the most dramatic changes in the last 30 years has been China becoming the largest consumer in the world from the largest exporter, he said. The middle class in China is growing and "they want quality products, they want quality healthcare and well-known products, they want quality food distribution and they want the technology that can support that," he said.

If there's a trade war, China won't be able to import the technology and the product they want from the United States but the U.S. will suffer as well because "we want exports, we want access to those market, and if there's a trade war, there would be two losers," Petrilla pointed out.

Besides, China may turn to other countries for imported products since the U.S. is not the only supplier, he said, warning that hundreds, if not thousands, of small agribusinesses in California will suffer from a trade war.

The United States and China have been locked in a major trade dispute over the past few weeks after Trump threatened to impose additional duties on Chinese goods worth 100 billion U.S. dollars, following proposing steep tariffs on Chinese imports worth 50 billion dollars.

In response, Beijing announced tariffs on major U.S. exports to China worth 50 billion dollars.

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