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China: Developing Country and World Trade Giant

Uri Dadush | June 09, 2021

China remains a developing country but is also a dominant force in world trade. This duality is the source of acute tensions in trade relations, and has culminated in a trade war between China and the United States. China is accused of taking advantage of trade rules that are too lenient: lack of reciprocity in market access, insufficient protection of intellectual property, and widespread and opaque subsidization. Responding to these criticisms, China is making progress on market access and intellectual property protection, but its progress in addressing subsidization appears to have stalled. There needs to be more awareness in China of the repercussions of its policies on world trade, and more recognition in the West of China’s constraints and limitations as a developing country.