Fri 26 November 2021
Associate Professor Weihuan Zhou was invited by Hinrich Foundation to discuss a new report titled ‘Corporate Subsidies by China, the EU, and the US: Time for Reforms’ co-authored by Prof Simon Evenett (Professor of International Trade and Economic Development and MBA Director, University of St. Gallen) and Johannes Fritz (CEO, St Gallen Endowment for Prosperity Through Trade).
Associate Professor Zhou agreed with the observations and evidence presented in this report and then shared some views about Chinese subsidies, the adequacy of current trade rules, and ways for future trade negotiations. He argued that the existing WTO rules on industrial subsidies, coupled with China’s WTO-plus obligations, may well be sufficient to deal with Chinese industrial subsidies. He further argued that future negotiations of industrial subsidies must not be disproportionately focused on China and instead must focus on addressing trade-distortive subsidies in all economies involved. He proposed a new way for such negotiations through a scheduling approach whereby countries are given the flexibility to decide how to balance their commitments to regulation of subsidies and their policy space to use subsidies for regulatory goals.