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Trump using cudgel against world trade: China Daily editorial

China Daily | Updated: 2018-07-02 21:40
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Even though Washington helped design the World Trade Organization and the trade body usually rules in favor of the United States when Washington brings cases before it, US President Donald Trump seems intent not only on criticizing the WTO but on sidelining it completely.

Reports reveal he has been considering the draft of a bill for the US to abandon key WTO principles so he can "have more say" over US trade policy.

A White House official confirmed to CNN that Trump ordered the draft legislation and was briefed on it in May, even though those who drew up the proposal believe it to be "unworkable".

The leaked proposal, referred to as the United States Fair and Reciprocal Tariff Act, would give Trump the authority to act based on his administration's assessment of trading policies between nations. This would mean the US president would be acting of his own volition instead of adhering to the collective rules of the WTO and the US' obligations as a member.

Although it is thought that if put forward, the proposal would face opposition in Congress, even that is not certain given the extent to which the restraints on the presidency have been softened.

Trump has already caused a crisis in the WTO by blocking the appointment of new trade judges, which has threatened to destroy the dispute settlement system. But quitting the WTO, as he will no doubt have been advised, would not be in the interests of the US, no matter how much anathema Trump has for the trade body.

Although his administration claims to welcome economic relationships rooted in fairness, reciprocity, and faithful adherence to the rules, it belies that by acting unfairly and breaking the rules so it can take as much as it can without giving anything back.

Yet even by resorting to economic brutality his administration will not be able to extort prosperity from others.

The US' prosperity and security are being challenged by its lack of competitiveness in many sectors, not because it has to play by the same rules as its trade partners.

The world is undergoing a profound adjustment, and while some sectors in the US will feel the pain of change, history shows international trade boosts countries' economic growth over the long-term, and there is no reason why the US should prove an exception.

By running roughshod over the WTO rules with its attempt at an economic shakedown, the US is shooting itself in the foot, as it has triggered retaliation from all its major trade partners.

Dictatorial bent of US is the real global threat: China Daily editorial

With US President Donald Trump announcing the United States withdrawal from the Iranian nuclear deal last month and now ratcheting up the pressure on Teheran, confidence that the multilateral deal can survive has been fading day by day.

However, although Iran is making preparations to revive its nuclear program should the deal fall apart, the visit to Europe this week by Iranian President Hassan Rouhani has raised a glimmer of hope that the nuclear nonproliferation deal will hold, as he has indicated Teheran's willingness to reach an agreement with the European Union that with the support of China and Russia will keep the deal alive.

However, in an interview with Fox News on Sunday, Trump piled pressure on European countries by threatening to sanction European companies that do business with Iran.

It is a threat of extraterritorial sanctions to block trade and financial activities by non-US parties that he has extended to other countries doing business with Iran — something that the international community should resolutely oppose as it breaches the sovereignty of other states.

China, for instance, maintains normal economic exchanges and trade with Iran that are conducted on the basis of conforming to its obligations as a signatory to the Iran nuclear deal and under international law.

The US has no right to impose its will on China and others and to try and coerce them to stop their legal trading with Iran. Countries that still believe in multilateralism should work together and push back against the unilateralism of the Trump administration so that the international norms of behavior remain intact and the US is not able to dictate who trades with whom depending on its own interests.

Meanwhile, the Iranian nuclear nonproliferation deal is at a crossroad, for if the EU and other economies yield to the coercion of the US it will spell the end of the deal. As long as Iran and the EU do not retrogress in their commitment to nuclear nonproliferation, there is still hope that the Iran nuclear deal will be able to survive without the US.

The deal is an important achievement of multilateralism, one that has proved effective since it was agreed. Safeguarding the deal will not only be conducive to preventing the proliferation of nuclear weapons and preventing further chaos in the Middle East, it will also continue to uphold it as an example that hot issues can be resolved through diplomacy.

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