China's slams US 'arrogance' on WTO status

China Monday said the US threat to pull recognition of China's "developing nation" status at the World Trade Organisation showed its "arrogance and selfishness", ahead of crucial trade talks this week.

The reaction followed a memo issued on Friday by President Donald Trump to US Trade Representative Robert Lighthizer, stressing that some countries were enjoying lenient treatment by "improperly" identifying themselves as developing economies.

The memo is widely seen as a swipe at China.

The Trump administration's demand "further exposed its wayward arrogance and selfishness", Chinese foreign ministry spokeswoman Hua Chunying said at a regular briefing Monday.

One or a few countries "should not have the final say" on which nations should be categorised as developing countries, Hua said.

She insisted that China needs to maintain its status as a developing economy to "achieve real trade fairness".

Trump's memo said the WTO, which operates a global system of trade rules and settles disputes, uses "an outdated dichotomy between developed and developing countries that has allowed some WTO members to gain unfair advantages".

Without "substantial progress" to reform WTO rules within 90 days, Washington will no longer treat as a developing country any WTO member "improperly declaring itself a developing country and inappropriately seeking the benefit of flexibilities in WTO rules and negotiations", said the statement, which focused mostly on China.

The memo came ahead of meetings in Shanghai on Tuesday and Wednesday between US and Chinese negotiators aiming to resolve a trade dispute that has led to tariffs on more than USD 360 billion worth of two-way trade involving the world's two largest economies.

Washington "obviously timed the memo to serve as a new bargaining chip" in the trade talks, the official Xinhua news agency said in a commentary.

"But the tactic of imposing pressure is nothing new to China and has never worked," it said.

Xinhua added that the US government's "latest hegemonic attempt" to coerce the WTO "is destined to hit a wall of opposition".

Developing country status in the WTO allows governments longer timelines for implementing free trade commitments, as well as the ability to protect some domestic industry and maintain subsidies.

But Jennifer Hillman, a former top US trade official who served at the WTO, has said the benefits granted to countries with the special status in most cases has long passed.

The Trump administration has long complained that WTO rules are unfair to the United States, and has nearly throttled significant WTO proceedings by refusing to name new members of the appellate body for the dispute settlement system, which will cease to function later this year.

Despite Trump's criticisms Washington has, in fact, won the majority of complaints it has filed with the WTO.