A Significant Contribution to the Global Multilateral Trading System

Chinese Premier Li Qiang recently announced that China, as a major developing country, will not seek new special and differential treatment in the current and future WTO negotiations. This significant announcement was made at a United Nations General Assembly-related meeting on September 23, 2025.

Against the backdrop of unprecedented challenges confronting the multilateral trading system, China made the solemn commitment to safeguard and strengthen this system.

China’s position paper comprises three integral parts. First, China is a developing economy and a member of the Global South, and is entitled to the inherent institutional right to special and differential treatment in the WTO. Second, China has consistently exercised its right to special and differential treatment in an independent and pragmatic manner. Third, in current and future WTO negotiations, China will not seek new special and differential treatment (S&DT).

S&DT: A fundamental guarantee for developing economies

The General Agreement on Tariffs and Trade (GATT) was founded in 1948 with the core principle of unconditional most-favored-nation (MFN) treatment for all members alike, which led to considerable tariff cuts worldwide through several rounds of multilateral trade talks and, consequently, robust growth in world trade and the world economy.

Conversely, disadvantages emerged for developing and least developed economies. Compared to developed economies, their products were significantly less competitive and thus hindered economic development. As a result, they demanded special favors. The UN General Assembly established the UN Conference on Trade and Development (UNCTAD) in 1964, taking into full account the balance between free trade and economic development. GATT, on its part, added Part IV “Trade and Development”. In 1968, UNCTAD agreed to establish a general, non-discriminatory, and non-mutual preferential trade mechanism, known as the Generalized System of Preferences (GSP), for developed economies. This mechanism provides much lower tariff levels on products from developing economies. In 1979, the GATT parties conference approved the Clause of Authorization, providing a legal basis for GSP, which became part of GATT 1994.

The WTO replaced the GATT in 1995, but inherited all GATT clauses, which constitute special and differential treatment. According to UNCTAD statistics from October 2000, S&DT comprises 145 measures. Developed WTO members should provide favor treatment in terms of tariff, market access and technical assistance. The developing WTO members were eligible to enjoy higher flexibility in commitments, actions, and trade policy tools, as well as more exception measures, and a longer transition period.

While the multilateral trading system, based on the current WTO rules, has achieved significant successes for all members, the S&DT in particular has contributed substantially to the trade and development of developing economies, especially, low-income developing countries (LIDCs) and least developed countries(LDCs).

Since the WTO’s founding in 1995, merchandise trade has grown at a rate of 5.8 percent per year, and service trade at 6.8 percent per year. Total global trade (merchandise and services combined) reached $33 trillion in 2023, more than five times the amount in 1995. The implementation of S&DT, resulted in a significant increase in the share of world exports from middle and low-income countries, rising from 17 percent to 34 percent. Additionally, the number of people living in poverty fell from 40 percent to 10 percent of the total population.

China and S&DT: Eligible yet flexible

At the time of China’s entry into the WTO in 2001, it was accepted as a developing economy and thus became eligible for WTO Special and Differential Treatment (S&DTs). China had enjoyed GSP for decades before its removal in recent years. It also benefited from the higher grain import tariff quotas, which protected its food industry.

Conversely, China has refrained from utilizing S&DT in most instances. Instead, it has taken voluntary measures to enhance market access. According to the final agreement of the Uruguay Round, WTO developed members committed to a lower average tariff rate of under 5 percent, and developing members committed to a rate of under 10 percent. By 2025, China’s average tariff level was 7.3 percent, while the trade-weighted average was 4.4 percent, very close to the level of developed members. China has also drastically cut the negative list, removed all restrictions on manufacturing market access and opened most of service sector to foreign investors. During the WTO talks on the COVID-19 vaccine IP waiver, China again agreed to forgo the transition period, which is an eligible right of a developing member. China has granted zero tariff to 53 LDCs in Africa, effective December 1, 2024. This preferential treatment usually awarded by developed economies. Contrary to Western critiques that claim China has gained significant advantages from the WTO’s Special and Differential Treatment (S&DT), China has actually received only limited special treatment.

China’s recent position paper indicates that it will retain its existing S&DT but will not pursue S&DT in future WTO negotiations. This means China will take on commitments similar to those of developed countries, significantly advancing future WTO discussions.

With all of this being said, China is still classified as a developing economy and is part of the Global South. In 2024, its per capita GDP was $13,303, which is below the World Bank’s high-income threshold of $13,935 and the global average of $13,673. This figure is significantly lower than Hungary’s $23,310, one of the lowest among developed economies. A country’s development status is based on its per capita income rather than its total economic size; for example, India has a larger economy than Switzerland but is not considered developed, whereas Switzerland is. China’s status as a developing member of the WTO will remain unchanged, and it will continue to defend the rights that come with this status.

A key supporter and driver of global multilateral trading system

China’s latest announcement of no longer seeking S&DT in future WTO negotiations demonstrates its significant responsibility and contribution to upholding the global multilateral trading system. Ngozi Okonjo-Iweala, Director-General of the WTO, hailed China’s decision as a critical moment for the WTO, demonstrating its commitment to a more balanced and fairer global trading system.

This shift will benefit all WTO members. Developed nations may feel more inclined to put forward new offers, expecting reciprocal steps from China. At the same time, developing countries could see renewed motivation, knowing that China is no longer seeking S&DT. Together, these dynamics could inject momentum into efforts to strengthen global trade and development.

It will also be conducive to improving China-U.S. trade relations, as the U.S. will have no reason to complain China’s competitive advantage from S&DT.

It will be a key driver in WTO reform, the central topic of the WTO 14th Ministerial Conference in Cameroon in March 2026.

The world multilateral trading system will receive fresh, strong support, and will prevail over unilateralism and protectionism over time. China will continue to demonstrate responsibility and make continuous contributions to building a community with a shared future for humanity.

The article reflects the author’s opinions, and not necessarily the views of China Focus.