How the label “developing country” is assigned has become a bone of contention for the United States in its assessment of China and the WTO. But China can find middle ground by looking toward the World Bank’s GNI classification standard.

President Trump’s most recent threat to leave the WTO has caught worldwide attention. Would removing itself from the organization be beneficial for the United States, or is it just a bluff?

Trump’s most recent memo to the WTO is the latest in a series of unilateral aggressions by the U.S. Given the relentless combativeness of the Trump Administration in global trade more broadly, the memo targeting WTO norms is unlikely to have any productive results.

China says US trade policies are threatening the existence of the World Trade Organization.

Japanese prime minister says nation will use presidency of group of industrialized countries to push for changes.

Multilateral institutions, like the World Trade Organization, have become proxies for differing visions of the global order and international relations.

In the past two years, the Trump administration has started trade wars against China, its major trade partners, and security allies. In the absence of united opposition by advanced and emerging economies, the next target will be the World Trade Organization.

As President Trump seeks to ramp up pressure on China by implementing additional tariffs, he and his administration may find the constraints of international law and WTO procedures hard to circumvent. Washington should suspend its tariff threat, sit down with President Xi’s reform-minded team and press for the further liberalization of China’s foreign direct investment and intellectual property rights regimes.

U.S. policy-makers must recognize that the most productive path forward is not to maneuver into constant conflict with China but rather to concentrate on our own competitiveness, to restore a sense of national unity, and to re-emerge from the current political cycle as an example of an open market democracy that others are both willing and able to emulate.

Although President Donald Trump appears to have changed his tune on China from all-out accusatory on the campaign trail to grumbling in the Oval Office, U.S.-China economic relations are at their most precarious in years. The issue of trade is a major stumbling block between the two nations.