course, so far the EU is still the second largest user of the dispute settlement
mechanism; China soared to the fourth largest user in a very short time due to the
high degree of complaintsfiled against China after 2006, but China still lags far
behind the EU in terms of absolute number.
Third, the number of disputes to which a member is a party is one main indicator
for evaluating the impact of this member on the dispute settlement mechanism, the
WTO and then the multilateral trade system. China is significantly rising compared
with the EU.
6.2.3 Main Causes
6.2.3.1 Objective Factors
First, China’s economy and trade have rapidly grown, significantly moved forward
in the world’s ranking and also made up considerably increased proportions. The
EU’s indicators have basically remained stable, but its proportions have fallen.
Second, China-EU economic interaction has become increasingly close and
dependence on foreign trade between the two sides has markedly increased. In
2004, the EU became the largest trading partner for China, while China became the
second largest trading partner for the EU. Currently, the two sides are the largest
importing market and exporting market for the other side.
According to the theory that trade volume is directly proportional to trade
frictions, it is a normal phenomenon and also a long-term tendency that the cir-
cumstances where China and the EU argued with each other under the dispute
settlement mechanism grew out of nothing. In fact, the proportion of cases in which
complaints werefiled between China and the EU was relatively low compared with
the respective total trade volumes of the two sides; the bilateral trade volume did
not reach the WTO’s average level. It is not surprising that both sides will bring
more disputes to the dispute settlement mechanism in the future.
Moreover, other factors including the impact of the protracted Doha Round on
the credibility of the WTO, the sluggish growth of the world economy in recent
years, etc. have also affected this somewhat.
6.2.3.2 Subjective Factors
First, China seldom became a party to disputes because China’s perceptions had not
yet changed; its intentions were inadequate and its capability was limited within the
firstfive-year transition period after China’s accession to the WTO. Afterwards,
China’s perceptions changed and its awareness was enhanced, but its capability was
still inadequate, thus complaintsfiled against China were three times thosefiled by
China. This sharp contrast to the EU which was highly familiar with the situation
showed that China’s capabilities for dealing with complaints needed to be
128 L. Heng