The Ministry of Commerce (MOFCOM) Photo: VCG

China is strongly opposed to the US Trade Representative (USTR)'s release of the Annual Report on China's WTO Compliance which contains groundless accusations against China, an official of China's Ministry of Commerce (MOFCOM) said on Wednesday, adding that the US should retract its misguided words and abide by WTO rules and America's pledges.

The US side ignores China's great achievements in fulfilling its WTO commitments, distorts China's achievements in building a market economy, denies China's important contribution to the multilateral trading system and global economic development, and at the same time uses its own criteria for defining a "market economy" to judge other members, said an official in charge of WTO affairs at the ministry on Wednesday.

"This lacks both legal basis and factual basis. It exposes the unilateralist thinking and persistent bullying practices of the US. China is firmly opposed to that," said the official.

Over more than 20 years since its accession to the WTO, China, as the largest developing member, has always supported the multilateral trading system, practiced true multilateralism, fully fulfilled its WTO commitments, expanded institutional opening-up at a high level, enhanced policy transparency, and participated fully in WTO reform negotiations and activities, said MOFCOM.

According to the ministry, China has actively helped more developing members especially the least developed economies integrate into the multilateral trading system.

During the 12th WTO Ministerial Conference in June 2022, China, acting in the common interests of all WTO members, played a constructive role and contributed to the conference achieving more than expected fruitful results, which were highly recognized by all parties.

The WTO Dispute Settlement Body has ruled that relevant US measures violate WTO rules. The US has not only failed to implement the WTO ruling, but has also paralyzed the appellate body of the WTO. China is deeply disappointed that the core values and basic principles of the multilateral trading system have been severely weakened, the ministry official said.

"The US is and has been in flagrant violation of WTO rules, such as the CHIPS bill. So before blaming China, the US should look at whether it is following the rules of international trade," Gao Lingyun, an expert at the Chinese Academy of Social Sciences in Beijing, told the Global Times on Wednesday.

In recent years, the US has engaged in trade bullying, manipulated double standards in industrial policies, disrupted global industrial and supply chains, and seriously undermined the authority and effectiveness of the multilateral trading system. 

The USTR released its 2022 Report to Congress on China's WTO Compliance on February 24. "More than 20 years after it acceded to the WTO, China still embraces a state-led economic and trade approach that runs counter to the open, market-oriented principles endorsed by all members of the organization," said the USTR report.

"We should clearly rebut these unfounded accusations by the US in international settings," Gao noted.

Gao stressed that as inflation in the US persists, it will lead to an economic recession, pulling down the recovery of the world economy and even triggering debt crises in some countries. 

Trade protectionism by the US has come back to bite itself, while having disrupted global industrial and supply chains. 

US enterprises and consumers have been suffering as the tariff revenue collected has been borne almost entirely by US importers of Chinese goods. The trade war is seen by many US industry associations as an economic and political loss.

By increasing tariffs on China's products, the US is actually ramping up prices in its own market and putting pressure on American consumers. Some research reports have indicated that tariff increases on Chinese goods have led to a one percentage point increase in US core inflation rate, Gao said. 

More than 6,000 US importers have sought compensation from the US government for billions of dollars in tariffs they have paid on Chinese goods, arguing that the policy was created without following proper procedures, the South China Morning Post reported on Tuesday.

Tariffs through 2019 had led to a net loss of $16 billion annually to the US economy, the SCMP reported citing an analysis by economist Pablo Fajgelbaum of the University of California.

According to statistics from the US Census Bureau, in 19 states in the US, imports from China accounted for more than 20 percent of their total imports, and 41 states have more than 10 percent of imports from China.