Trade grows where the WTO goes
Beijing and Washington are singing a similar tune on reforming the World Trade Organization (WTO).
On Wednesday, Xi Jinping led a Politburo study session focused on international trade and the WTO.
Listen up: For over two decades, the Politburo has held study sessions alongside its monthly meetings.
- They provide a window into the leadership's top-of-mind issues.
This month, Xi used the session to throw his support behind the WTO (The Paper):
- "We must firmly safeguard the authority and effectiveness of the multilateral trading system with the WTO as the core."
That requires work: Xi said he wants China to play an active role in reforming the WTO – especially its dispute settlement mechanism.
Get this: US Trade Representative Katherine Tai voiced a similar message last week (Politico).
- "Right now, being committed to the WTO also means being committed to a real reform agenda."
The stumbling block: The US crippled the WTO's dispute settlement panel in 2019 by blocking appointment of new judges, partly due to disagreement over how China and other "non-market economies" should be treated in disputes.
Get smart: With both Xi and the Biden administration calling for change, there's potential for a real breakthrough at the WTO's next high-level meeting in February.
Get smarter: The world's two largest economies cooperating to fix the world's most important multilateral trade framework would go a long way to reducing jitters in the global economy.