Guard against the overflow of new trade protectionism trend

UPDATED: 17:14, June 18, 2007

A new trend of thought with respect to a new trade protectionism has been overflowing in the United States, Europe and Japan in recent years. This trend is designed to retain their dominant status in global economic competition in compliance with the socio-economic features of their respective countries under the conditions of economic globalization. The new trade protectionism is a new form of global economic rivalry in the contemporary world and has wrought relatively great negative impact to the growth of China's external trade. For the past eleven consecutive years, China has become the world's No. one target of anti-dumping investigations, with an ensuing annual loss of anywhere from 30 billion to 40 billion US dollars.

In the wake of the intensification of economic globalization and multi-lateral trade system, tariff and other traditional means of trade protectionism have been weakened. In the meantime, there is a transference of the world division of industries and, with regard to the flow of capital and technology, there is also a shift of competitive power between nations and regions. In such circumstances, many developed nations bring forth the "new trade protectionism" to avert the restricting mode of the multi-lateral trade system.

"The new trade protectionism" has several ensuing characteristics:

First, to play the "legitimate' traditional trade protectionism cards within a space of the multi-lateral trade system, such as anti-dumping or anti-subsidizing cards; second, to create various kinds of new "trade walls" by taping the initiated advantages of economic societies of the developed nations to direct against the disadvantages of the developing countries, including technical barrier to trade, technical criteria barrier, green trade barrier, the intellectual property rights (IPR) barrier and labor value barrier; third, to extend the trade protection scope, which includes not only freight trade but service trade, finances, exchange rate, IPR and other spheres and, fifth, to monopolistically protect core technologies, for instance, the imposition of the unilateral trade sanction measures the U.S. resorts to its "special 301th clause" to directly challenge the world trade rules and regulations.

As the adverse current or a vortex in economic globalization, the new trade protectionism weakens the multi-lateral trade system at the expense of the unblocked flow of economic factors worldwide and the balanced global social development. From a long-term point of view, it will be detrimental to global environmental protection and sustainable economic growth. Such measures, if overused, will also jeopardize the economies of the developed nations themselves.

As far as China is concerned, it has only to actively involved itself in the "game" to cope with the "the new trade protectionism." Under the current trade system and regulations, it should, externally, say whatever it has to say, lodge whatever lawsuits it has to file, and take whatever measures it deems as necessary. In so doing, the country will have the awareness of vying or competing for survival. Internally, it should promptly adjust its production mix to raise the ratio of its domestic demand to the national economic development, so as to comply with the situation and environment in the global trade. Furthermore, China should strive to upgrade the technical levels of industries, including the enhanced requirements for environmental protection, and acquire more core technologies. So, for an enterprise and its products, the supreme vista for economic competitiveness is up to clients to choose or select commodity products on their own and let its rivals have nothing to says or complain. Chinese industries and their products should scale such a peak height.

By People's Daily Online and its author is Huang Qing, a PD senior editor

People's Daily Online ---