China’s entry into WTO has had widespread consequences

They say the road to hell is paved with good intentions.

An adviser in U.S. government relations, geopolitical risk and international affairs says the road to world economic trade is filled with plenty of non-compliance potholes since China joined the World Trade Organization in 2001.

“The U.S. was the leading trading partner of almost every country in the world… Thanks to what I think is one of the most foolish blunders in modern American diplomacy, we encouraged and welcomed China into the World Trade Organization without being able to hold it accountable for its complete violations of so many of the criteria required to exceed to the WTO and to remain a responsible stakeholder in the WTO,” John Sitilides told the recent Alberta Beef Industry Conference.

“Now we have a situation where China, thanks to its astonishing rise as a global economic power, it is a manufacturing colossus, with the world’s leading factory floors and an unmatched logistics network. It is now the leading trading partner of so many countries around the world. The U.S. is really reliant on Canada, Mexico and Western Europe as main trading partners, but really losing most of the global south and Asia to China.”

Seeing the ever-growing trade deficit with China, President Donald Trump imposed trade sanctions during his first term, which were kept and built upon by former president Joe Biden.

Trump continued the tariff push weeks into his second term as president. The trade deficit has lowered slightly in recent years, which Sitilides attributes less to the amount of Chinese goods coming into the United States and more China using countries such as Mexico and those in Southeast Asian to circumvent U.S. sanctions.

Sitilides said China and India were the two largest economies in the world until the mid-19th century, when they encountered the British Empire and saw their economies downsized significantly.

“China (was) always destined to rise, but what I think is extraordinarily foolish on the part of Republicans and Democrats in Washington to facilitate the rise of what was going to be your greatest competitor, if not outright rival and enemy in many respects,” said Sitilides.

There have been two technology initiatives launched by Chinese president Xi Jinping since 2013 in a scale never seen before in its geopolitical influence on the world stage, he added.

“Made in China 2025, here the Chinese government has chosen about 10 frontier technologies in which it is investing tens, if not hundreds of billions dollars to become the dominant player in the 21st century economy and artificial intelligence in quantum computing, robotics, electric vehicles, renewable energy, synthetic biology, aerospace, telecom and semiconductors,” Sitilides said.

“The degree to which it is able to achieve that dominance, a second initiative called China Standards 2035, where it dominates the global interoperability of an open and dynamic and innovative system, along with our allies in countries like Germany, Japan and South Korea, who were able to set the interoperability standards in the second half of the prior century, until now.…

“But under the Communist Party’s definition of what constitutes global interoperability, we may be seeing the global economy moving into a more closed, repressive authoritarian direction, where ultimately, if China’s standards are mirrored in other economies as they take on Chinese-dominating technologies, we may see the ongoing diminution of individual dignity, human rights and privacy as the suffering people of China under communism have been experiencing.”

He said the U.S. enjoys very close ties to countries such as Japan, South Korea, the Philippines and Taiwan. From a U.S. perspective, China is extraordinarily resentful of its presence in East Asia and is determined to push the U.S. out and establish hegemony over East Asia, which it believes is its rightful historical place as the inheritance of a 4,000-year-old Chinese civilization.

The South China Sea has approximately one-third of the world’s commerce going through every year, connecting markets in the Middle East and Europe to China, Taiwan, Japan, South Korea and Southeast Asia. It is estimated 10 to 15 per cent of the world’s untapped oil and natural gas reserves are in the sea bed of the South China Sea.

“Yet, China has declared this entire region, to the exclusion of the sovereign rights and exclusive economic zones of every country around the South China Sea. The only reason it’s still recognized as an international waterway is because the U.S., along with our allies, such as Japan, the U.K., Australia and France, continue to sail through international waterways and fly through international airspace,” said Sitilides.

“Every time we do, we’re trailed by the People’s Liberation Army, Navy and Air Force. They issue diplomatic demarches, and we’re very much focused on a possible conflict, a crisis in Taiwan, but there could be an episode in the South China Sea that actually triggers a diplomatic crisis between Beijing and Washington and similarly, Beijing seeks to one day achieve what we call anti-access area denial status in the Indo Pacific.”

Sitilides said China is developing an aircraft carrier killer missile DF 26 that can hold U.S. aircraft carriers at bay 2,000 miles away, so that the U.S. can no longer provide a credible security umbrella for Japan, Philippines, Taiwan and South Korea, forcing those countries into making China the dominant hegemony, managing all of Asia’s commerce that would significantly tilt communist influence on the world economy .

“Asia’s commerce by 2045-50 would likely constitute about half of global GDP, and we’re trying very hard to ensure that we effectively deter China from blockading or ever invading Taiwan because if that happens, we envision certainly a profound recession on a global scale, and perhaps a deep impression in Asia, given the impact of a war that involves China, the world’s number two economy, probably drawing in Japan, the number three, over in Taiwan, the number 22 and maybe even South Korea, which is number 10.”

Tags: markets, Mexico, Western Europe, China, trade, Canada, India, WTO, U.S., World Trade Organization, tariff