CYIL vol. 13 (2022)

CYIL 13 ȍ2022Ȏ THE ATTITUDE OF THE PEOPLE’S REPUBLIC OF CHINA TOWARD INTERNATIONAL LAW Agreement (CAI) is intended to increase EU companies’ access to China’s vast market and level the playing field for EU investors. The agreement will also restrict China’s practice of forced technology transfer from EU companies to the Chinese government. 94 However, given China’s record of non-compliance with its international treaty obligations, one can anticipate problems with implementation going forward. Some critics of the agreement criticize the EU for not extracting from China a commitment to respect human rights and labor standards. The agreement was hastily completed in time for Chancellor Merkel to claim victory before the end of Germany’s EU presidency. Some would argue the agreement does not go far enough, as it sacrificed the plight of the Uighurs and China’s growing disregard for the rule of law at home and abroad. The agreement was signed on the eve of the Biden administration taking office. The CAI is a setback for President Biden and a benefit for China, as Biden wants to develop a unified front with EU partners in dealing with China. China’s long term strategy is to split the EU from the US, which in turn would further weaken the US bargaining position vis-à-vis China. That would also make it more difficult for the EU and US to develop new rules that would adversely impact China’s global ambition. China’s Belt and Road Initiative (BRI) is Xi Jinping’s signature foreign policy project. It is consistent with his goal of building a new world order dominated by China. China has spent billions of dollars on the BRI and is expected to invest trillions more in the future. BRI will link infrastructure projects in Asia, Europe, and Africa. BRI is the most ambitious investment project undertaken by a state since the Marshall Plan. BRI will significantly increase China’s influence in recipient countries and will lead to high debt among some participating states. 95 BRI is considered the greatest investment tool of the Chinese state and is likely to expand despite US pressure. As a member of the WTO, China has not always played by the rules. Both the US and EU have initiated proceedings against China before the WTO Dispute Settlement Board (DSB) for its refusal to grant reciprocal open market access to their exports. They have also complained about China’s unfair trade practices, its subsidies, and preferential treatment of Chinese-owned companies. In effect, the US and the EU have accused China of dumping, discrimination in trade practices, and evading WTO rules. China requires all foreign companies operating on its territory to transfer technology to Chinese companies or the government. It also copies or steals the intellectual property rights of foreign companies. China enjoys free market access in the United States and the EU but deprives foreign corporations the reciprocal rights in its market. This gives Chinese companies an unfair advantage over their foreign competitors. Finally, the People’s Liberation Army or its surrogates have engaged in corporate cyber espionage to steal trade secrets from American and EU companies. Under its WTO accession agreement, China was initially granted developing nation status, which allowed for its exports to receive favorable trade preferences without having to reciprocate. However, now that China has the second-largest economy in the world, it has resisted relinquishing that preference.

94 SOLOMON, E., CHAZAN, G. ‘We Need a real policy for China’. Fin. Times (Jan. 6, 2021), p. 13. 95 HURLEY, J., MORRIS, S., PORTELANCE, G. Will China’s Belt and Road Initiative Push Vulnerable Countries into a Debt Crisis? at https://www.cgdev.org/blog/will-chinas-belt-and-road-initiative-push-vulnerable-countries debt-crisis/ (Mar. 5, 2018).

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