Meanwhile, though fears of China
as an economic competitor first emerged in the West, developing countries,
which only three years ago embraced new trade links to Beijing, have started to worry as well. In South Africa, which once enthusiastically
welcomed Chinese investment, President Thabo Mbeki has warned Beijing not to dump goods on his country. In Thailand, which once touted a new trade deal
between China
and Southeast Asian states, politicians have begun worrying that imports of
Chinese produce will destroy Thai agriculture.
In the past, politicians sometimes were able to ignore
middling support for free trade and push deals anyway; NAFTA hardly had
overwhelming public backing. But in an ever-tighter American political scene--one
in which many voters increasingly blame trade for the insecurity of the modern
workplace, rather than taking a hard look at other factors that might be
causing these problems, like Americans’ abysmal savings
rates and companies’ willingness
to shower senior executives with pay packages--no one can afford to lose
votes. While in Europe, a series of
referendums on Continent-wide initiatives, like a new European constitution,
have forced EU politicians to listen more to the public. Though European
politicians once shunned the kind of tough trade sanctions preferred by the U.S.
Congress, EU Trade Commissioner Peter Mandelson, a longtime trade advocate, now
suggests Europe should consider taking trade cases against China to the
World Trade Organization. What’s more, as many developing nations have become
true democracies over the past decade, their politicians now have to take
public opinion into consideration. After thousands of demonstrators in 2006
surrounded a hotel in Chiang Mai where Thai and U.S. negotiators were attempting to
hammer out a bilateral free trade deal, the proposed agreement soon collapsed.
With public support waning, nearly every major trade
initiative is on life support. The Doha Round has missed one deadline after
another. Though WTO head Pascal Lamy plans to host more Doha discussions later this year, progress most
likely won’t be made before a new administration takes over the White House--if
it happens at all. President Bush already has lost his “fast track” trade
authority, which allows him to put trade deals to Congress for straight yes-or-no
votes. With Doha sidelined, countries in Asia,
Africa, and Europe will focus instead on
bilateral preferential trade deals, which lead to what Haruhiko Kuroda, head of
the Asian Development Bank, calls a “spaghetti bowl” of overlapping deals that
often conflict with each other and confuse companies trying to invest across an
entire region.