Author: Hu Weija
Posted on: Global Times, March 30th, 2017
There has been a lot of discussion about Chinese President Xi Jinping‘s first face-to-face meeting with US President Donald Trump, but less attention has been paid to the official delegation from Mexico to China. Trump’s protectionist rhetoric has been bad news for the Mexican economy, forcing Mexico’s governors to turn to China to tap into other potential for cooperation.
Trump is unlikely to change his stance on trade in the short term while economic malaise is pushing some EU countries toward more protectionist policies. Against that backdrop, strengthening cooperation between developing countries has become more important as import demand in advanced economies is expected to shrink.
Mexico, one of the biggest victims of growing US protectionism, is among the first batch of countries taking practical measures to respond to changes in the trade environment. A delegation of Mexican state leaders visited China this week to beef up cooperation with the country’s province-level governments and to introduce Mexico’s special economic zones to Chinese business leaders. In previous decades, major export markets for products made in developing countries were in North America and Europe, resulting in intense competition for enterprises from developing countries in the race to win consumer markets in developed nations. But now Trump’s anti-free trade rhetoric and a rise in protectionism in some EU countries may become a driving force for cooperation among developing countries as they turn their focus away from markets in developed economies.
A World Bank report earlier this year stated that economic growth in emerging and developing economies is expected to register at 4.2 percent in 2017, while advanced economies will see growth of only 1.8 percent this year. In addition, rapid growth in emerging countries like China and India has attracted a lot of attention. Now is the right time for developing countries to commit to reciprocal opening up in a bid to share each other’s consumer markets.
China is speeding up its process of fostering a high-standard global free trade network, which developing countries, such as Mexico, are likely to be welcome to join. China is also witnessing a boom in outbound direct investment. Economic complementarity between China and other developing countries will be further enhanced as Beijing steps up efforts to promote the One Belt, One Road initiative and encourages Chinese firms to invest more in countries along the routes.
It seems that developing countries have begun exploring effective ways of enhancing economic cooperation, to an extent shaking Washington’s influences on the global economy and international affairs as the US pursues trade protectionism policies. The upcoming meeting between Xi and Trump will offer an opportunity for Washington to change the situation by being more open minded over free trade.