With the development of trade, cross-border flows of data and the formation of global value chains, the difference of trade regulations between countries have caused unnecessary trade burdens and institutional costs. In order to promote in-depth development of the international economy and ensure global consumers’ safety and environmental protection, it is necessary to have good trade regulatory cooperation between countries. However, the relevant norms and mechanism at the multilateral and regional levels are seriously deficient. The European Union and the United States are currently creating a new type of mechanism on trade regulatory cooperation through TTIP which reflects a new paradigm of global trade regulatory cooperation. It consists of specific contents of four parts: the sectors and fields for cooperation, the institutional framework, good governance practices, and the " Impact Assessment”. The mechanism is uniquely designed, flexible, and pragmatic which can effectively balance the relationship between international cooperation and the sovereignty for regulations. Being a permanent dialogue and cooperation mechanism, it has a high degree of openness and public promotion. However, there are still differences in sensitive areas, regulatory principles, and constitutional and political structure arrangements between the EU and the United States which make their regulatory convergence difficult. In view of this, the EU and the United States have chosen pragmatic and flexible legislative techniques, and have changed the option of " international high standards” to the gradual cooperation model. If the cooperation between the two sides is achieved, the global trade regulatory standards and public policies will highly be promoted, and the " good governance practice” of global trade will become a lead. However, the shift of " economy competition” to " institution competition” led by the EU and the United States will increase the cost of competition and block the market access of other countries by raising the rules’ threshold. In particular, the democratic evolutionary requirements implied in it will inevitably bring big challenges to developing countries. China’s participation in international economic activities in the future will be subject to strong external pressures which demand the improvement of government management and institutional establishment. China needs timely and effective reactions internally and externally. At the international level, China needs to actively participate in the international legislative activities of trade regulatory rules, carefully handle the relationship between trade liberalization and sovereignty for regulations, and steadily launch " Chinese trade regulatory cooperation”. The following measures are recommended: to participate in the international organizations（e.g. OECD）research and guideline formulation activities; to provide the framework of trade regulatory cooperation in China’s high level FTAs, and to create a " trade regulatory cooperation version” for developing countries with the opportunity of the " One Belt, One Road” proposal. At the domestic level, China needs to strengthen the economic structural reforms and optimize government management. First, green and healthy industries with ideas of sustainable development, labor and environmental protection should be promoted, and high-quality and environmentally-friendly products meeting international high standards shall be encouraged. Second, transparency and participation of the people need to be guaranteed. Third, develop China’s own trade regulatory " Impact Assessment” with long-term effects. Fourth, deregulate and decentralize the power in trade and investment regulations, and improve the efficiency and safety of regulations with new technologies through the new attempts in China’s free trade zones.
A Research on the New Paradigm of Global Trade Regulatory Cooperation in TTIP and Chinese Reaction
Journal of Shanghai University of Finance and Economics Vol. 20, Issue 05, pp. 139 - 152 (2018) DOI:10.16538/j.cnki.jsufe.2018.05.011
Cite this article
Liu Xuehong. A Research on the New Paradigm of Global Trade Regulatory Cooperation in TTIP and Chinese Reaction[J]. Journal of Shanghai University of Finance and Economics, 2018, 20(5): 139-152.