Cambridge: Cambridge University Press, 2020. xii, 249 pp. (Tables, figures.) $29.99, paper. ISBN 978-1-108-81986-2.
Kristen Hopewell’s book Clash of Powers: US-China Rivalry in Global Trade Governance contributes significantly to the emerging literature examining Sino-American competition in the liberal international order and its impacts on governance and the Global South. Based on extensive research and over 200 interviews conducted from 2007 to 2018 at the World Trade Organization (WTO) in Geneva, the Organization for Economic Co-operation and Development (OECD) in Paris, as well as in Washington, Beijing, Tokyo, Brasilia, Sao Paulo, New Delhi, and Ottawa, the book provides a detailed, thoughtful, and nuanced account of five well-selected cases studies: the WTO Doha round, WTO agricultural subsidies, WTO fisheries subsidies, the OECD export credit arrangement, and OECD export credits for coal plants. The case studies allow for comparing competition in trade governance in a formal institution that includes China as a member (the WTO) and an informal institution that does not (the OECD arrangement). In the WTO, clashes between the US and China over reciprocity vs. SDT (Special and Differential Treatment) resulted in the collapse of the Doha round. Post-Doha, conflicts in the WTO continued in agricultural and fisheries subsides. In the OECD export credit arrangement, China actively resisted US efforts to incorporate it into existing or new agreements for export subsidies, including for coal plants.
Hopewell’s work argues that China’s rise has sharply restricted US institutional power in governance of multilateral trade, and the US-China rivalry is now the predominant dynamic shaping global trade governance. Increasingly, that competition is compromising the ability of that governance to function. The result is paralyzed institutions and broken-down rule making. Also, other major economic powers (e.g., the EU, Japan, Canada, India, and Brazil) have become peripheral in these institutions and governance compared to the US and China.
The book illuminates the challenges posed by the China paradox where China is simultaneously a developing country and one of the most significant economic actors in the international system. In global trade governance, China portrays itself as an advocate for developing country rights, but as its economic power grows, and China become the largest actor in many of these economic issues, the traditional North-South framing of trade issues becomes increasingly problematic. China’s rise increasingly creates friction between two fundamental principles of the multilateral trading system: reciprocity vs. SDT. By examining these tensions, the book highlights how the China paradox results in disagreements and conflicts of interests between not only China and the US and Western countries, but also China and the Global South.
Hopewell’s work also highlights the important interlinkages between trade policy and other issues such as development strategy, national security, food security, geo-political competition, the environment, and domestic stability. Those linkages often make these struggles intractable for both China and the US. Often, due to its economic interests together with linked issues, China has limited incentives to reduce subsidies or cooperate with the US in agreements on global trade governance.
Clash of Powers enhances understanding of Sino-American competition in the liberal international economic order. Geopolitical rivalry between the US and China is increasingly shaping their objectives and negotiations in the global trading system. The book argues that in this struggle for institutional power and setting the rules of the game, key aspects of American hegemony are impacted. In the WTO, where China is a member, there is paralysis and stalemate. In the OECD export subsidy arrangement, where China is not a member, China refuses to be incorporated, rules are undermined, and new rules are prevented from emerging. Although these developments constrain US institutional power and rule-setting ability, China is blocking multilateral trade rules, not creating new ones. The book raises fundamental questions about the ability of the multilateral trading system to function effectively as China rises and increasingly asserts itself as a status quo power in the global trading system, leaving the US as a dissatisfied, revisionist state.
Although this book focusses narrowly on trade issues in the WTO and OECD, its insights have potential broad applicability for understanding many facets of Sino-American competition in the liberal economic and political order. The tensions created by the China paradox and frictions between reciprocity and SDT and similar concepts exist in a wide range of functional areas, including development, the environment, food security, foreign aid, global health, human rights, nuclear proliferation, security, and technology. This book highlights linkages with some of these other issues, but its approach could also be utilized to examine case studies of the dynamics of the US-China rivalry in multilateral institutions in other functional areas. In a world where competition is likely to continue to be the defining characteristic of relations between the US and China, this type of nuanced analysis of US-China interactions in multilateral institutions will be essential to understanding how this great power rivalry is pursued and its effects.
Dawn Murphy
US National War College, Washington, DC
Disclaimer: The views expressed by the review author are personal ones and do not necessarily reflect the official policy or position of the National War College, Department of Defense, or US Government.