Trump threatens to pull US out of WTO

BY: The BBC
Mr Trump has been embroiled in a tit-for-tat trade battle on several fronts in recent months
Mr Trump has been embroiled in a tit-for-tat trade battle on several fronts in recent months

President Donald Trump has threatened to withdraw the US from the World Trade Organization (WTO) if the body fails to change the way it treats America.

"If they don't shape up, I would withdraw from the WTO," Mr Trump said in an interview with Bloomberg News.

The WTO was established to provide rules for global trade and resolve disputes between countries.

But Mr Trump, who has been pushing protectionist policies, says the US is treated unfairly by the body.

He said on Thursday that the 1994 agreement to establish the WTO "was the single worst trade deal ever made", though he acknowledged that the US had won some judgments in the past year.

His warning about a possible US pull-out from the organisation highlights the conflict between the president's trade policies and the open trade system that the WTO oversees.


Meanwhile, Washington has recently been blocking the election of new judges to the WTO's dispute settlement system, which could potentially paralyse its ability to issue judgments.

US Trade Representative Robert Lighthizer has also accused the WTO of interfering with US sovereignty.

What's Trump's beef with the WTO?
The US president has been sounding off about unfair trade since even before he became president.

Last year, Mr Trump told Fox News: "The WTO was set up to benefit everybody but us… We lose the lawsuits, almost all of the lawsuits in the WTO."

The US has been embroiled in a tit-for-tat trade battle on several fronts in recent months.

The one creating the most interest is the one with China, as the world's two largest economies wrangle for global influence.

Mr Trump has introduced tariffs on a number of goods imported into the US.

A third round of tariffs on $200bn (£154bn) of Chinese goods could come as soon as a public-comment period concludes next week, according to a Bloomberg report citing various sources.

Asked to confirm this during the Bloomberg interview, President Trump said that it was "not totally wrong".

China has responded to US tariffs by imposing retaliatory taxes on the same value of US products and has filed complaints against the tariffs at the WTO.

China's commerce ministry has said it "clearly suspects" the US of violating WTO rules.

An initial complaint at the WTO was filed by China in July after Mr Trump imposed his first round of tariffs.

The WTO is at the heart of the system of rules for international trade.

It is the forum for sorting disputes between countries about breaches of global trade rules and it is the forum for negotiating new trade liberalisation.

Has Trump made threats about other agreements?
Yes. On Monday Mr Trump announced that the US and Mexico had agreed to revamp the North American Free Trade Agreement (Nafta), calling it a "really good deal" that was "much more fair" for both countries.

He had previously threatened to pull out of the deal, triggering a year of talks, and demanded a renegotiation of the 1994 agreement - which he blames for a decline in US manufacturing jobs, especially in the car industry.

Canada, the third member of Nafta, is yet to agree to the new terms.

On Thursday, Mr Lighthizer held talks in Washington with Canadian Foreign Minister Chrystia Freeland aimed at reaching a new deal.

Following four separate meetings, which continued late into the night, Ms Freeland told reporters that a deal could not be reached, adding that talks would resume on Friday.

Mr Trump has set Friday as the deadline for Canada to sign an agreement, and has threatened to tax the country's automotive sector or cut it out entirely.

Credit: The BBC