WTO vigilant over growing disputes

By DING QINGFEN (China Daily) Updated: 2012-09-22 02:18

Besides traditional industries in China, some high-tech industries are becoming targets of trade investigations, including solar panels and wind towers. As the US enters a crucial period in its presidential election campaign, the US is expected to be tougher on China's trade policies.

Yu Benlin, deputy director-general of the Bureau of Fair Trade for Imports and Exports with the Ministry of Commerce, said the "situation of trade frictions against China is very severe, and there has been an upward trend."

Weak global economic growth "has an impact, notably on big, rich, deep exporting markets like Europe, US and Japan and has a consequence on trade in a number of emerging markets including China," Lamy said.

Growth of Chinese shipments has been on the decline during the past several months, decelerating to 1 percent in July, which casts a shadow over Chinese economic growth, which has been largely reliant on high-speed exports.

Early this year, the Chinese government set a target of 10 percent for this year's foreign trade growth and 7.5 percent for the nation's economic growth in 2012. But experts said the 10 percent target is not achievable.

China recently launched a series of measures to stabilize exports and stimulate the economy, including tax rebates and credit insurance, but many doubt whether the efforts will take off.

According to Lamy, investment and consumption are important amid slackened global trade.

"If China wants to maintain its growth rate, China will have to accelerate its economy more on the domestic side. There are two engines — investment and consumption — and China will have to play with both," Lamy said.

After the financial crisis landed in 2008, China launched a big stimulus package worth 4 trillion yuan ($630 billion), approving a large volume of big infrastructure projects.

"There's a big lever on infrastructure and we know this is the classic China way of stimulating the Chinese economy, but we also know this may lead to heavy debt, notably in the local authorities or over-capacity," Lamy said.

"Then of course the next question is how you can stimulate domestic consumption."

As part of its aim to transform its economic growth model, China pledges to boost consumption.

From 2011 to 2015, China's social retail consumption is expected to grow annually by 15 percent, reaching 32 trillion yuan in 2015. China's imports would surpass $8 trillion in the five-year period.

But for Lamy, "stimulating Chinese domestic consumption is not that easy."

Hurt by eurozone debt woes and tightening property policies, China's economic growth has been decelerating this year, with expansion slowing to 7.6 percent in the second quarter, the slowest pace in more than three years.

But, "what will remain true is that for the rest of the world and notably for growing countries, China will remain an important indispensable source of growth worldwide," said Lamy.

Megan L. Thomas contributed to this story.

Contact the writer at dingqingfen@chinadaily.com.cn