Every year, the US Trade Representative office has to write a report on China's compliance with the WTO rules to Congress, and they just held the public hearing to gather opinions yesterday. But after Trump has threatened to pull out of the WTO and signed a new NAFTA, does this mean that WTO has failed on addressing key trade issues? And is America's accusation on China's forced technology transfer valid? CGTN's anchor talks with Ricardo Melendez-Ortiz, CEO and Co-Founder of the International Centre for Trade and Sustainable Development, about the "failure" of the WTO, and the reason behind it. 

Zou: China is blamed the most for two problems - forced technology transfer and the government support for certain industrial policies. China sees these problems dramatically differently from the United States and many Western countries. How do you look at the gap of perception on this problem?

Ricardo: There are certain frameworks in the WTO that are helpful, and they will cover some of the concerns that the US and others have on what many see as a slower pace of reform for the Chinese economy.

It is true also that other countries, and not only the US, are complaining about a number of practices within the Chinese economy that affect their companies, with respect to technology transfer.

But technology transfer is a complex set of issues. It has to do with intellectual property, but it also has to do with the conditions in which investment comes into a market. Every country in the world makes certain types of conditions.

And so what I believe is that part of the problem that we have is that between China and the US, there's no bilateral investment treaty, so there are no terms for the exchange of investment between the two countries. There were talks going on before the new administration, and those have been suspended.

And at the multilateral level, we don't have a mechanism to govern over investment. We have a very disorganized, organically grown system of foreign direct investment.

Zou: So that says there is a strong demand for mechanism building globally, which is the job of the WTO. (Absolutely) But why has the WTO failed to deliver on that?

Ricardo: Well, partly it's a question of history and partly is that we are just now, in the past few years, at the global level, recognizing that trade and investment are two faces of the same coin. That investment affects trade and trade affects investment, and that most issues that we have really under this tension are investment-related issues.

So for instance, it put the emphasis on the protection of the investor, but not necessarily on other values. Like consumption protection, benefit sharing, the right to regulate and so on.

Countries today understand that those are critical issues, including sustainability questions. And so we are in a conversation at the global level on these issues.

And the good news is that WTO, just a few months ago in Buenos Aires at the Ministerial meeting at the end of 2017, created a group which was very much championed by China to start looking into bringing in investment into the WTO.

We'll have to see where that goes, but that's a possibility.

For more on Trade and WTO: 

Trade war and WTO: Updating the WTO, or waging a trade war?

Video Photographers: Zhou Jinxi, Huang Yichang, Wu Chutian 

Editing: Wu Chutian