Public-Private Partnership: The Chinese Dilemma

Abstract

As noted by Greg Shaffer in his book 'Defending Interests: Public-Private Partnerships in WTO Litigation', the US and EU have different approaches to public-private partnership in dealing with foreign trade barriers: the former tends to be more 'bottom-up', while the latter tends to be 'top-down'. Inspired by Shaffer's work, this article examines China's experience in establishing public-private partnership. Initially, China appeared to prefer the American approach by adopting the Rules on Trade Barrier Investigation (TBI), which empowers domestic firms to petition the government directly to launch investigation against foreign trade barriers. However, since 2005, China seems to have shifted to the European approach by adopting a 'Quadrilateral Coordination' system, which pools together the resources of the Ministry of Commerce, local government, and relevant industry associations to help affected individual firms to fight foreign trade barriers. The article analyses the pros and cons of the two systems, the political and social reasons for the shift, and how the new system has worked in practice with case studies. The article concludes with thoughts on the lessons we can draw on the relationship between the government and private firms in China, as well as how the public-private partnership will develop in China in the future.