Trade Linked to Investment by China — The New High Politics?


     China has recently linked investment into the EU to help solve its debt crisis, to trade demands. In particular, China wants the EU to reclassify China as a “market economy” for purposes of trade remedy litigation under the rules of the WTO. Specifically, this demand would require dropping the “constructive approach” utilizing third-market prices in determining the home market-price of goods in China, in favor of actual prices in China. This proposal would make it much harder for the EU to impose unilaterally antidumping duties under the WTO rules of global commerce. This development clearly illustrates the rising importance of trade to investment decisions in the context of high politics between major trading states. As if we really needed another example. Even the National Intelligence Council concluded last year that strategic rivalries in the future are most likely to revolve around trade and investment disputes.

About Stuart Malawer

Distinguished Service Professor of Law & International Trade at George Mason University (Schar School of Public Policy).
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