A WTO ruling without consequences

The World Trade Organization has decided: The reciprocal tariffs between the USA and China violate WTO rules. However, there will not be much progress in this matter. The spiral in the trade war is now turning in completely different areas anyway – tariffs are „old school,“ and the focus is on capital movements and knowledge transfer.

The tariff battle between the United States and China, which began in 2018, officially violated World Trade Organization (WTO) trade rules on both sides last month. In August, the WTO Dispute Settlement Body ruled that China’s „additional tariff measures“ were inconsistent with several articles of the General Agreement on Tariffs and Trade (GATT). In all likelihood, however, the tariff ruling will not have any concrete consequences – just as it did for the US. Not least because of the dysfunctional WTO, the trade war between the two economic powers is now being pushed into completely different areas.

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