Reform to Give the WTO More Powers to Prevent Unfair Subsidies

The German Economic Institute (IW) has called on the EU to join forces with African countries to reform the World Trade Organization’s subsidy rules as a way to counter Chinese market distortions and diplomatic influence. The IW published the paper ahead of a recent EU-China summit in Beijing. The issue of unfair competition is expected to top the agenda, 3 months after the European Commission launched an anti-subsidy probe into Chinese electric vehicles. Reform is to be a key topic at the WTO’s 13th ministerial conference (MC13) in February, although it requires a full consensus to make any substantive changes.

The WTO’s Africa negotiating group has proposed reforming current subsidy rules to better support developing countries – for example, allowing them to have local content requirements and to grant subsidies for environmental protection. The IW argues in its paper that the EU should expand this initiative to tighten subsidy rules on the world’s top trading countries.

Meanwhile, the debate this Newsletter reported on about imports of textiles from China by ecommerce companies without paying duties, taxes or applying regulations. SARS is now applying duties – based, EFSA has discovered, on the weigh of the parcels not the value!