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China wants bigger say in setting global trade rules; but is it ready?

CHINA has still a way to go before it can realise its ambition to have a bigger say in the terms governing international commerce and investment.

It is forging its own cross-border trade deals, backing the creation of new financial institutions and pressing ahead with major initiatives. But it still has some way to go before it can realise its goal, observers say.

China's ambitions were voiced late last month by Long Yongtu, China's chief negotiator for its WTO entry. He told a forum that China could now be a "rule maker" instead of a "rule follower" in trade-related areas like international investment, online business and climate change, the SCMP reported.

"Doubtlessly, China should become one of the leaders in global trade and investment rule-making," he said.

That followed President Xi Jinping's declaration in January that China was the world's standard-bearer for free trade and investment and could "lead world development trends."

In seeking to take centre stage, China is stepping into a role increasingly vacated by the West, where anti-globalisation sentiment and protectionism is on the rise.

Former vice foreign minister He Yafei said there was a lack of momentum among Western trading nations to advance the WTO system. "The global trade regime centred on the WTO has been rejected by western developed countries," he said. "They [Western countries] lack the interest or political incentives to move the system forward, and that's why we are seeing mushrooming regional trade talks."

Those regional efforts include US attempts to rally Asian partners around the Trans-Pacific Partnership and European countries around the Transatlantic Trade and Investment Partnership pact.

In the meantime, China has sought to expand its influence beyond its borders through Xi's aggressive promotion of the One Belt, One Road strategy. Beijing has also sought to promote a series of free-trade deals.

But it would take a great leap for China to become a rule-setting power. For a start, Beijing has failed to honour many of the promises it made during WTO entry talks, prompting the US and EU to hold off on granting it market economy status.

China has also failed to reach a bilateral investment treaty with the US despite 29 marathon rounds of talks. The main sticking point is US dissatisfaction with a long list of investment areas that would be off-limits to US players in China.

Former senior commerce ministry official Sun Yongfu said a similar agreement with the EU did not proceed "as quickly as expected by leaders on both sides" because China was not prepared to meet the higher proposed standards on labour, the environment and human rights.