“We know big countries like China have global responsibility. We would like to talk with the US to lessen the trade tensions. We have made candid efforts to try to resolve the concerns with the US,” Xiangchen told journalists in Geneva recently.
The journalists were attending an information seminar on international trade policy for English-speaking countries from Africa, Asia and the Caribbean oragnised by the WTO from December 10 to 15, this year.
The Chinese envoy to the WTO was responding to a question by Financial Times that had inquired on the impact of the ongoing trade war between China and the US to the economies of developing countries, including Tanzania.
“Tanzania is right to express concerns about the ongoing trade tensions between China and the US. It is true that when two elephants fight it is the grass that suffers,” said Xiangchen.
He said Chinese trade experts were currently in high-level negotiations with their US trade experts, adding that an agreement could be reached in the near future.
However, Xiangchen cautioned: “But of course we need to work for the best and prepare for the worst. With regard to the pressure on protectionism we have to resist the pressure, otherwise we cannot see the light at the end of the tunnel.”
In October, this year, the WTO, an organisation that deals with rules of trade between nations at global level, warned that rising global trade wars were a threat to African economies.
The global trade wars have resulted in noticeable instability and lower economic growth is some African countries, said the global trade organisation.
Keith Rockwell, WTO’s Director of Information and External Relations Division, said the rising US dollar as a result of the trade tensions was also hurting African economies.
He said between 2013 and 2017, sub-Saharan African debt levels denominated in foreign currency were up 80 per cent, adding that in non-resource intensive countries the jump was about 18 per cent.
Rockwell was responding to the Financial Times that had requested him to explain the impact of the ongoing trade friction between the United Stated and China at the regional dialogue on Challenges for the Multilateral Trading System-Perspectives from East Africa held in the Kenyan capital Nairobi.
The dialogue was jointly organized by the Friedrich Ebert Stiftung (FES), a German organisation promoting democracy and good governance, social justice and globalization with a human face and the WTO.
“Per capita income growth remains sluggish. Rapid increase in the working-age population means that by 2035, the number of people in low-income countries reaching working age (15–64) will exceed that of the rest of the world combined,” he told the dialogue that brought together civil society organisations from Kenya and journalists from Tanzania, Kenya, Uganda, Rwanda and Ethiopia.
Rockwell recalled an African proverb that says: “When two elephants fight, it is the grass that suffers most”. “And when global economic powers are engaged in trade wars it is African countries that suffer,” he added.
Although there was no definition of a trade war, Rockwell quoted WTO Director General Roberto Carvalho de Azevêdo as saying: “Whatever the definition, the first shots have been fired.”
He said $413 billion in trade has been affected by tariffs and the WTO has recorded 16 dispute settlement cases arising from tension caused by trade wars in the areas of steel and alluminnium (7), counter tariffs (5), intellectual property (2), China tariffs (2).
“WTO estimates that a full blown trade war would cut trade by 17 per cent and GDP by 1.9 per cent,” said Rockwell.