Varieties of contestation: China’s rise and the liberal trade order

Abstract

This article reassesses whether, and if so how and why, China contests the WTO's liberal trade order. Our framework on 'varieties of contestation' goes beyond the mainstream view of a monolithic Chinese trade policy that either challenges or supports the liberal trade order. We propose a two-step approach that allows for a more differentiated assessment. First, a constructivist analysis captures the extent to which China embraces liberal trade norms. China may contest the validity of the liberal compromise that underpins WTO rules (frame contestation) or merely express disapproval regarding their application (claim contestation). Second, a political-economic analysis of sector-specific preferences allows us to explain why China engages in contestation in some cases, but not in others. Empirically, we examine three sectors that have played a crucial role in recent WTO discussions: steel, agriculture, and information technology. We find that contestation is more prevalent in steel and agriculture compared to IT. It is only with respect to the steel sector, which is state-permeated and where behind-the-border regulation is at stake, that China contests the validity of the prevailing liberal compromise. This pattern of selective contestation suggests that China will neither entirely abandon the WTO nor proactively revive it.

The Rise of China and Contestation in Global Tax Governance

“…Thus, whereas prior research has highlighted variation in China's engagement with global economic policy across different policy domains, our paper shows that this variation also takes place within the same policy domain (cf. Weinhardt & Brink, 2020), and varies with the domestic business context. This suggests a need to take account of both inter and intra-policy domain variation (Pereira 2017;Rowley et al 2017).…”

“…WTO membership has enabled inward and outward integration of firms into global value chains, yet has been marked by both highly selective negotiation, implementation and enforcement across corporate sectors and policy areas, depending on the domestic political and economic context. For instance, where sectors are closer connected to the Chinese state, or more in need of domestic protection, China is more likely to contest liberal trade rules, as evidenced by the government's more favourable stance towards liberalization of tariffs in China's globally competitive IT industry as compared to its weaker national steel sector (Weinhardt and Brink 2020). Similarly, China's enforcement of WTO-mandated intellectual property protections, to which it signed on, depends both on varying local law enforcement capacity and the degree to which products cause harm to consumers (Hung 2003).…”

China’s rise in a liberal world order in transition – introduction to the FORUM

“…They find that with the increased transnationalization of China's economyin the context of globalizing neoliberal capitalismit partly needs to emulate liberal practices, institutions, rules and networking modes, as shaped by a largely US-dominated liberal order and partially integrates into these global power structures, networks and institutions. Yet, while doing so China encounters severe impediments, some of which are structural (McNally, 2019), some of which pertain primarily to the norms, rules and principles embedded in the liberal order (Weinhardt & ten Brink, 2019), and others that are related to elite power structures that are argued to form a social foundation of the liberal order (De Graaff, 2019;Huo & Parmar, 2019).…”

China’s Relationship with the Liberal International Order: The Case of the Asian Infrastructure Investment Bank

“…China's partial and gradual adaption of the liberal international order means that it also resists the call for liberalization to a certain extent and holds on to the distinctive (read, illiberal) aspects of its state-society model and governance (De Graaff et al, 2020;Weinhardt and Ten Brink, 2020).…”