China has a problem, and they should admit so before others sit them down for an intervention. Besides China’s most-favored nation tariff on imports of 9.6%, which compares to 3.5% in the US or 5.3% for the EU, China is the king of non-tariff barriers, points out Christopher Balding for Bloomberg. Laughably insecure moves, such as the recent banning of Western children’s books that peddle in corrupting cultural imperialism, or prohibiting popular shows such as the Big Bang Theory are unnecessary. Administrative policies aimed at protecting local firms are widespread in areas ranging from financial services to luxury goods, and even baby formula. But China’s new priorities are to spur innovation and entrepreneurialism, and that can only be done through competition. China now has strong local players, and they will only be stymied by further protectionism. Add to that the diplomatic wins China would score with the US and EU in the face of growing populism abroad and opening markets is win-win for the Middle Kingdom.
Empty shelves display notices regarding stock for Belamy’s organic toddler milk formula at a shop in Sydney, Australia. Phtoto: Reuters, David Gray
China has lots of room to play nice on trade
Trade barriers are a huge problem not just for trading partners but for China’s own goals as well