On March 31st, the Legal Advisory Committee on Economic and Trade Frictions of the China Council for the Promotion of International Trade (hereinafter referred to as the “CCPIT”) released the 2020 annual report of global economic and trade measures index (hereinafter referred to as the “2020 annual report”). At the press conference, Zhang Yuejiao, director of the Economic and Trade Legal Advisory Committee of the CCPIT, introduced the background, results of the global economic and trade measures index research project and the main findings of the 2020 annual report.
The main findings of the 2020 annual report of the global economic and trade measures index involve the following four aspects:
First, global economic and trade frictions are in severe circumstances, with more competition and frictions between major powers. In 2020, the global economic and trade measures index (hereinafter referred to as the “GETMI”) is at a high level in most months of the year, with an overall upward trend amid fluctuations. In terms of index rankings, four countries (regions), India, the United Kingdom (hereinafter referred to as the “UK”), the United States (hereinafter referred to as the “US”), and Brazil ranked among the top five in most months.
Second, the adoption of the five types of measures in GETMI conforms to the basic rules of the application of trade measures, yet also demonstrates new trends. Clearly, import and export restrictive measures witnessed intensified conflicts against the background of the pandemic and Sino-US trade frictions. Trade remedy is a measure frequently used by major countries, and close attention should be paid to the impact of such a measure on other measures, many of which are directly extended to areas such as intellectual property investigations and export controls. Judging from new cases, the trade remedy investigations initiated by the US, India and Canada ranked among the top three in 20 countries (regions) in 2020. Import and export tariff measures are cautiously adopted by major countries (regions), mainly developing countries, and main issuing countries are Brazil, Turkey, Argentina and India. As technical trade measures are more “invisible”, “difficult to monitor” and “unpredictable”, they have become a commonly adopted measure in major countries (regions). But at the same time, technical trade measures also indicate that the issuing countries honored their transparency obligations, and comprehensive considerations are thus required. “National security” features prominently in other restrictive measures. Supportive measures in relation to subsidies and other forms accounted for 75.9% of a total of 1,179 other restrictive measures issued by 20 countries (regions) in 2020, suggesting that all the major countries have issued subsidies and supportive measures to support their industries and enterprises under the impact of Covid-19 pandemic. The top five countries in the number of other restrictive measures issued are all developed countries (regions), namely the US, the European Union (hereinafter referred to as the “EU”), the UK, Canada and Australia.
Third, the measures issued by 20 countries (regions) cover a huge range of products, almost all the two-digit products in the 98 chapters of 22 categories identified by the International Customs Council are included. The most affected industries include motors, electrical equipment & parts, organic chemicals, mechanical equipment, etc.
Fourth, the WTO Dispute Settlement Mechanism remains the world’s most dynamic settlement mechanism for international disputes. The US, the EU, China, and India are active players in the mechanism.
The GETMI selects 20 representative countries (regions) in economy, trade, regional distribution, and trade with China as samples to study import and export tariff measures, trade remedy measures, technical trade measures, import and export restrictive measures, and other restrictive measures, and follow closely the main changes and trends in global economic and trade frictions. The index measured in an all-round way from three aspects: countries (regions) with global representativeness, economic and trade friction scoping and measure selection with widespread recognition, and science-based and reasonable index calculation and methods.
According to the Outline of the 14th Five-Year Plan (2021-2025) and the Long-Range Objectives Through the Year 2035, economic security risk warning, prevention and control mechanisms and capacity building need to be strengthened to ensure safety and control in key industries, infrastructure, strategic resources, and key technologies. In 2021, the monthly report of the GETMI will be released on a regular basis to watch more closely and conduct more in-depth research on the economic and trade measures in major countries (regions), provide early warnings for potential economic and trade frictions and conflicts through the index research of changing trends, and further analyze specific affected industries, in a bid to make a modest contribution to China’s industrial and economic security.
The GETFI was compiled by the China Machinery Industry Information Institute and Shanghai AllBright (Beijing) Law Office. The Global Economic and Trade Measures Index only provides early warnings and risk reminders for reference purposes, and cannot be regarded as the sole basis for making decisions. Your comments or feedback is highly appreciated.