Japan, the EU and the US have ramped up pressure on Beijing over its model of state-sponsored capitalism, calling for tougher World Trade Organization curbs on government subsidies, reported the Financial Times.
In a rare example of the Trump administration turning to allies for help in solving trade problems, the three issued a joint statement on Tuesday on a proposal for more stringent global rules to prevent Chinese companies relying on state support to gain advantage over foreign rivals.
The proposed rule changes take aim at core parts of China’s economic model, calling for a wider WTO ban on various types of state support and for governments to do more to prove that aid to companies does not distort trade. The proposals amount to a joint manifesto for closing what the US and others argue are loopholes in the WTO rule book that have been exploited by Beijing.
Phil Hogan, EU trade commissioner, said they were “an important step towards addressing some of the fundamental issues distorting global trade”. The EU “has been arguing consistently that multilateral solutions can be effective in solving these problems”, he said.
