A WTO appeals panel has upheld a ruling against China restricting exports of nine types of raw materials. The ruling, completely unreasonable to Chinese, will threaten China's resource preservation and environmental protection efforts.
China has generally been following WTO regulations and rulings. But it should find the best balance between applying WTO rules and protecting its national interests. Getting approval from the West is not our top concern.
Admittedly, joining the WTO has boosted China's rise. However, entry was granted at the cost of China accepting some unfair terms, from which the aftereffects have gradually emerged, including this ruling. They may become a hidden problem for China's economy.
The latest WTO ruling has highlighted the urgency of amending some of the unfair terms of The Protocol of China's Entry into the WTO. It is also necessary to express China's dissatisfaction and garner public support for the revision.
WTO regulations are the result of compromise reached through rounds of negotiations, dominated by the West's interests. The high-tech export embargo by the US against China has never been questioned. Trade barriers and abuse of WTO regulations are prevalent in Western countries.
Due to unfamiliarity with the WTO system, and worries of Western media censure, China has often opted to follow WTO rules. Investigations into other countries' trade activities have been rare.
But this ruling means a lot to China, which already faces huge pressure in its environmental protection efforts. The price for being the world's factory is high energy consumption and heavy pollution. Cheap exports of its resources such as rare earths will eventually undermine the domestic industry that relies on them. China has been alerted to the unsustainable practice, and export restrictions are inevitable.
The WTO body seems to have forgotten the basic principle that mutual benefit is the basis of trade, which cannot take place if it is not present. China can consider putting up market barriers in response to the ruling.
The intention is certainly not to disrupt the WTO system, but at the same time, there is no need for China to be a model member. Conflict and compromise are part and parcel of the global trade mechanism. Every country seeks to maximize its benefits, and self-imposed sacrifices will not bring any gratitude.
China has benefited from globalization, but China's rise is first of all the result of Chinese hard work, not taking advantage of the trade system. Squeezing China through WTO loopholes will be futile.