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China Lecture Series 30: “The Rise of China and the Future of the Global Economic Order” by Prof. Karel De Gucht

China Lecture Series 30
Special Lecture by Karel De Gucht - “The Rise of China and the Future of the Global Economic Order”

16:00-18:00 September 19, 2017
KFAS Conference Hall

Korea Foundation for Advanced Studies (KFAS) invited President Karel De Gucht of Institute for European Studies at Vrije Universiteit Brussel to give a lecture on “The Rise of China and The Future of The Global Economic Order” on September 19th as the 30th lecture in the China Lecture Series. Based on his experience as the former EU Commissioner for Trade, Professor De Gucht gave a lecture specifically on the rise of China from European perspective.

Professor De Gucht began his talk by stating that the world’s relationship with trade and globalization took an unpredictable turn in 2016. He mentioned that globalization is getting blamed for everything wrong in the world today and that people tend to disregard the benefits gained from globalization in the past. Professor De Gucht adamantly claimed that turning toward protectionism is not the answer, expressing his concern about the US withdrawal from TPP. Moreover, he talked about the fact that China is trying to position itself as a global leader on free trade.

Professor De Gucht explained how China has made headway into the overseas market in order to resolve domestic overcapacity problem. He pointed out that China resorts to dumping where it exports products abroad far below the agreed production price with the risk of market distortions. He expressed concerns that if China is granted Market Economy Status without meeting the international criteria, China’s dumping on the European or Asian market would even get worse and it would be more difficult to hold China accountable for their unfair trade practices.

Professor De Gucht further elaborated on how President Xi Jinping has tried to extend China’s influence over the world through ‘One Belt, One Road’ initiative. As the Medieval Silk Road, the Maritime Silk Road and the AIIB are particularly intriguing for the less developed countries, he explained, China is emerging as a ‘friend’ rather than as a threat. However, he pointed out that some of China’s activities in Asia or Africa are not helping the developing countries move forward but are only making them dependent.

Talking about Chinese potential to change the entire landscape of today’s global economic order as a new player in international trade, Professor De Gucht put emphasis on the need for Europe to take its leadership role more seriously. He expressed support for Europe to go through with TTIP (Transatlantic Trade and Investment Partnership) and to have a voice in trade liberalization so that new players like China can become responsible global stakeholders. But most importantly, he argued, Europe must remain true to its high values on respecting the environment, labor standards and human rights.

The lecture was followed by a discussion and Q&A session led by Professor Cho Youngjeen of Graduate School of International Studies at Ewha Woman’s University. Citing the world free trade system, Professor Choi Byung-il of Ewha Woman’s University asked Professor De Gucht what he thinks about the Paris Agreement and Brexit. Professor De Gucht pointed out that the United States is a country driven by industry and that it would be difficult for President Trump to get out of the Paris Agreement. On Brexit, he stressed that most EU member states would no longer consider the option of leaving the EU since the UK example demonstrated that this option would lead to isolation.

Professor Choi indicated that a new perspective is necessary to understand China, considering the fact that China itself argues it has a new type of democracy. Stating that China is not a democracy, Professor De Gucht anticipated that its political system will not change for a long time.

Professor Choi also asked about Professor De Gucht’s candid opinion on FTA between Korea and EU as the former EU Commissioner for Trade. Professor De Gucht answered that EU has gained several benefits from the FTA such as increase of trade and job creation. He concluded by stressing the importance of a balanced FTA for the two mature economies, Korea and EU, highlighting reciprocity in trade negotiation.

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