Varieties of contestation: China’s rise and the liberal trade order

Abstract

This article reassesses whether, and if so how and why, China contests the WTO’s liberal trade order. Our framework on ‘varieties of contestation’ goes beyond the mainstream view of a monolithic Chinese trade policy that either challenges or supports the liberal trade order. We propose a two-step approach that allows for a more differentiated assessment. First, a constructivist analysis captures the extent to which China embraces liberal trade norms. China may contest the validity of the liberal compromise that underpins WTO rules (frame contestation) or merely express disapproval regarding their application (claim contestation). Second, a political-economic analysis of sector-specific preferences allows us to explain why China engages in contestation in some cases, but not in others. Empirically, we examine three sectors that have played a crucial role in recent WTO discussions: steel, agriculture, and information technology. We find that contestation is more prevalent in steel and agriculture compared to IT. It is only with respect to the steel sector, which is state-permeated and where behind-the-border regulation is at stake, that China contests the validity of the prevailing liberal compromise. This pattern of selective contestation suggests that China will neither entirely abandon the WTO nor proactively revive it.

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