The new reality is we need to protect our industries - The Australian

As China has blocked more Australian exports over the past year, we have been implored to trust the international rules-based trading system. That used to mean something. After World War II, countries did sign many international trading agreements that opened up an era of free trade not seen since the 19th century.

However, since China joined the World Trade Organisation the rules of the system have been stretched to breaking point. China has subsidised its industries well beyond what was allowed under the terms of its ascension to the WTO. For example, the Alliance for American Manufacturing estimates 80 per cent of the profits of Chinese steel producers come from government subsidies.

China’s flouting of the rules has caused others to do the same. An increasing array of tariffs and protection have been introduced in response to China’s subsidy-fuelled growth.

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