Chinese Wisdom in Global Economic and Trade Rules

Openness Brings Progress

At present, global trade governance is confronted with two challenges. First, the new trade pattern – represented by the global value chain – demands the adjustment of international trade rules. Second, emerging economies call for reconstruction of the global trade governance structure that is currently led by major countries. Signs of rising trade imbalance, state protectionism, and populism are notable on the global value chain. To this, Zhang Yuyan responded, “It is not a problem of economic globalization itself, the problems come from outside.”

Indeed, economic globalization brings favorable opportunities for China to realize very rapid development. According to the World Bank, China’s nominal GDP, based on constant price, increased by 9.6 percent annually from 1992 to 2016, rising more than nine fold.

Complying with economic globalization, China has risen to the center of the world economy. The country imports raw materials, energy resources, capital, and technology, and exports high-quality products. China has become a leading engine of the world economy. In 2016, it contributed 33.2 percent of the world economic growth, ranking first in the world. Today, China is the only country with all the industrial categories classified by the UN.

To put it simply, people’s accumulation of wealth or China’s rapid development wouldn’t be possible without globalization. China has grown to be a major country in global governance. China actively promotes an open economy and shares opportunities and interests with other countries across the world.

In January 2017, at the opening ceremony of the Davos World Economic Forum, Chinese President Xi Jinping’s remarks were forceful and resounding: “We should commit ourselves to growing an open global economy to share opportunities and interests through opening-up, and achieve win-win outcomes. We firmly oppose protectionism. Pursuing protectionism is like locking oneself in a dark room. While wind and rain may be kept outside, that dark room will also block light and air. No one will emerge as a winner in a trade war.”

In the report delivered at the 19th CPC National Congress last October, President Xi enunciated China’s vision to the world: “We should develop a modernized economy and make new ground in pursuing opening-up on all fronts. Openness brings progress, while self-seclusion leaves one behind. China will not close its door to the world, and it will only become more and more open.”

Global trade rules belong to the whole world. It means that they should be discussed and amended after consultation by major economies or authoritative international platforms in light of various countries’ appeals. Undoubtedly, the “Chinese approach” would be indispensable in this process.