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As the shockwaves of those events ripple across continents, they are causing a far-reaching realignment of international relations – economically and geopolitically.
There are many other shifts underway. China has grown into a competitive and assertive power that challenges the current rules-based system. It is a major trading partner for both the EU and the US. But we must learn to carefully manage the risks that come with this relationship.
This brings me to my second point – the importance of the Transatlantic relationship for steering a pathway through these complex global challenges.
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Fixing the World Trade Organization is a crucial piece of the puzzle. There can be no doubt: It needs to be revitalised, updated and reformed.
And we also need to remember: In spite of all the Organization’s problems, 75 % of world trade still takes place on WTO terms. It is the most favoured nation principle that has underpinned the resilience we have seen in trade throughout the dramatic global challenges of the last years.
Let us consider the alternative. A fragmented trading system based on power relations will harm everybody and benefit no one – with the exception perhaps of China. If Western countries, including the US, want to maintain a rules-based world order and balance China’s influence in particular, there is no alternative to strengthening transatlantic leadership in these fora.
This is why it is crucial for us join together to advance the much-needed reforms at the 13th WTO Ministerial Conference next month.
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Source: European Commission
Speaker: Valdis Dombrovskis, Executive Vice-President and European Commissioner for Trade
Format: Speech
China Policy Research 