At the heart of the multilateral trading system is the commitment to nondiscrimination, the most-favored-nation (MFN) principle, mandating that all nations participate on equal terms. Added to this are a series of obligations to limit government interventions in trade. To give assurance that the system will deliver what it promises, transparency is required, making clear to all the measures that affect trade. Reality diverges from the ideal.

Chapter 8 summarises the main findings from the preceding chapters, and discusses the best way to deal with the China challenge. Contrary to those who prefer unilateral and plurilateral approaches, we argue that the potential of multilateralism has yet been fully explored. As we have documented, it was the desire to normalise its trade relations within the multilateral framework that prompted China’s initial decision to return to the multilateral trading system. While China did pursue unprecedented market-oriented reform, the potential of the multilateral rules in taming China’s state capitalism has not been fully unleashed since China’s accession. Of course, recognising the potential of multilateralism does not mean that multilateralism is perfect. Instead, we believe that multilateralism is the most promising compared with unilateral measures and bilateral and plurilateral negotiations outlined above. In addition to making fuller use of the existing rules under the WTO, this book has also put forward some approaches for the negotiation of new rules at the multilateral level where such rules are needed and suggested ways to engage China in a more constructive manner.