China uses Belt and Road initiative to fight unfair trade criticism

The Chinese government is defending its association with developing countries, arguing that it will continue to support open trade and fight “backward” measures to prevent free enterprise.

In an apparent dig at the US decision to impose tariffs on Beijing, China’s ambassador to Kenya Sun Baohong argued that those opposed to liberal trade and criticising Beijing’s venture in Africa are fighting global development.

“China firmly believes that there is definitely no winner in a trade war. The United States is launching a trade war not only with China, but also with the whole world, dragging the world economy into a treacherous zone,” she said in a press statement.

FREE TRADE

By defending what it calls free trade, Chinese authorities have this past week explained their support for the World Trade Organisation and promoted the Belt and Road Initiative, meant to open up trade between China, Asia, Africa, Europe and the Latin America by building ports, railway lines and shipping links.

In Nairobi, Ms Sun spoke of how free trade has ensured China’s rise to be the world’s leading economy.

But she said the US and certain richer countries are still unwilling to open up level-playing field in trade.

China, she argued, “firmly supports the multilateral trading system.”

Since its accession to the WTO in 2001, Beijing says it has been liberalising and facilitating trade and investment, safeguarding the dispute settlement mechanism and fully participating in trade policy review.

WTO FOCUS

“China has also called upon the WTO to the focus more on the concerns of developing members, opposed unilateralism and protectionism, upheld the authority and efficacy of the multilateral trading system and made concerted efforts with other members in supporting the WTO to play a greater role in economic globalisation.”

The WTO is an intergovernmental organisation, not a UN body, which brings together countries of varying economic development and often provides rules for open trade and resolves disputes related to international trade.

TRADE SUBSIDIES

In the last ministerial conference in Nairobi in 2015, richer countries ducked demands to iron out trade subsidies given to their farmers, as developing countries demanded equal treatment at the agricultural market.

Ms Sun was speaking on China’s White Paper on the WTO, a recent document published to “to give a full account of China’s fulfilment of its WTO commitments, to explain China’s principles, stances, policies, and propositions regarding the multilateral trading system.”

But she also had another eye on the Belt and Road Initiative, President Xi Jinping’s policy to expand China’s influence through trade and investments.

Next month, China is due to hold a summit with African leaders, including Kenya, in Beijing, known as the Forum on China-Africa Cooperation (Focac).

In the last such meeting in South Africa in 2015, China offered Sh6 trillion worth of grants and loans for infrastructural development.

DEBT OVERLOAD

But critics argue that China has been overloading the continent with debt and tilting trade agreements only in favour of Beijing.

In Kenya, Beijing is the biggest external creditor with Nairobi owing more than Sh534 billion in bilateral debt.

Ms Sun argued that this funding and the Belt and Road Initiative, though creating a debt situation, “is a reflection of common aspirations” for prosperity and development and the need to tackle the challenge.

“Some people are too critical to be objective. They claim that there is a debt trap when they just see the word loan. They are full of anxiety even when the relevant countries do not worry about it themselves,” she said in another commentary.

“If I may ask the critics and doubting Thomases: What would you bring to these countries? The answer seems like No Action, Talk Only! No country has been crippled by a debt crisis due to its cooperation with China,” she added.