Trump Says United States Will Leave WTO Unless It ‘Shapes Up’

This comes on the heels of the announcement that America is hitting China with another round of tariffs.

Donald Trump threatens WTO with US withdrawal.
Michael Reynolds / Getty Images

This comes on the heels of the announcement that America is hitting China with another round of tariffs.

Donald Trump launched a blistering attack on the World Trade Organization (WTO), saying that America will leave the trade governing body unless it “shapes up” and heeds American interests.

Trump has been critical of the WTO, which was formed in 1994 as an international body tasked with creating a global trade structure and resolving disputes between countries. Trump called the Marrakesh Agreement, which led to the formation of the WTO back in 1994 with 124 participating countries, the “the single worst trade deal ever made” in an interview with Bloomberg.

“If they don’t shape up, I would withdraw from the WTO,” Trump said in an Oval Office interview.

This interview comes quickly on the heels of a burgeoning trade dispute between America and China, with the former announcing that it would hit the Asian country with the third round of tariffs believed to be in the region of $200 billion as early as next week — a move which has been panned widely by economists and also by the European Union. Moreover, Trump’s rhetoric towards the international trade body is seen as problematic for member nations.

Even so, none of this has stopped Trump from singling out WTO and claiming that world trade will be better off without the economic body.

One of the reasons that Trump is so wary of WTO is because of its open trade policies, which is something in direct confrontation with his own more protectionist views on trade. Trump claims that the WTO has become increasingly biased against America over the years and has treated it “very badly.” He argued further that the WTO has abdicated its duties on many occasions by failing to resolve trade disputes brought forward by the United States against other countries.

But he also said that since he has become America’s president, there has been a veritable change in the Switzerland-based organization.

“In the last year, we’re starting to win a lot. You know why? Because they know if we don’t, I’m out of there.”

Simon Lester, a trade analyst at the Cato Institute, told the Economic Times that Trump’s claims about the United States losing out in trade disputes at the WTO were not entirely accurate, as records showed that America tended to do better than the global WTO average — both in terms of cases that it brings to the international body and the cases brought against it.

Trump’s stance has caused international consternation, with EU and Japanese officials visiting Washington last week to try and work on WTO reforms, particularly as it concerns China’s “non-market” economy. The US has blocked the WTO from appointing new judges, effectively choking up the system that resolves international trade disputes.