ABSTRACT
In Part 1 of this book I analyzed developing-country efforts to reform the GATT and WTO in order to make trade rules more conducive to their economic agenda. The results were disappointing and the playing field remained largely tilted against their exports. It is interesting to note that, from time to time, the United States too complained of an uneven playing field that allowed countries like Japan and China to amass massive trade surpluses while American manufacturers and exporters struggled to break into ‘closed’ markets. This perception of unfairness was a defining feature of US–Japan trade relations in the 1970s and 1980s and receded only after the Japanese economy entered a prolonged period of recessionary economic conditions in the 1990s. More recently, some of the hostility previously directed toward Japan has shifted to target China, given the phenomenal growth of its exports and trade surpluses. The US government alleges that China was manipulating its currency to keep it undervalued in order to boost exports and dampen imports. The accusatory language however is much less strident than was the case with Japan, perhaps because of China’s status as a developing country or because Chinese exports are concentrated at the lower end of the technology spectrum and therefore less threatening to core US industrial interests, such as automobiles and steel.
