This chapter examines efforts to establish new global rules to restrict export subsidies for coal-fired power plants, which are highly polluting and a major contributor to climate change. Government-backed export credit for coal power plants acts as a form of export subsidy, and thus promotes the expansion of such plants abroad. The US spearheaded multilateral negotiations within the context of the OECD Arrangement to prohibit the use of export credit for coal power plants. However, since China is not part of the Arrangement, it was not a participant in the negotiations or bound by the new disciplines created. China’s absence, I argue, weighed heavily over the negotiations and undermined efforts to construct an ambitious agreement. OECD exporters were extremely resistant to agree to restrict their use of export credit when China—the world’s largest supplier of export credit for overseas coal plants, accounting for nearly half of all export credit in this sector—would face no similar restraints on supporting its exports. Without China’s participation, the impact of the resulting agreement is severely limited. This case thus highlights the difficulty of building effective global trade rules today without the participation of China.

China’s rise has transformed the global politics of agricultural subsidies, which is among the most controversial issues in the trading system. China has emerged as the world’s largest subsidizer, upending the entrenched understanding of agricultural subsidies as a harm perpetrated by the Global North upon the Global South. From a North-South battle, WTO negotiations on agricultural subsidies have been transformed into a conflict centered on the US and China. The US, as the world’s largest agricultural exporter, is eager to restrain China’s subsidies and insists that it will only agree to stricter rules on its own subsidies if they also apply to China. But China has refused, insisting that as a developing country, it should be exempt from any new restrictions on subsidies. The US has been unable to force China to accept disciplines on its subsidies, leading to a stalemate. While reducing trade-distorting subsidies remains a pressing concern for developing countries, efforts to negotiate new and strengthened disciplines at the WTO have been paralyzed by an impasse between the two dominant powers, heavily shaped by the hegemonic rivalry between the two states. China, along with the US, is now blocking pro-development reform of the trading system at the WTO.