Is China a mastermind or scapegoat in global trade? The real story behind the scenes

Global trade’s favourite villain is back in the dock. Depending on whom you ask, China is either the tireless architect of a manufacturing miracle or the shadowy puppet-master bending the rules of commerce. To understand why the accusations fly—and whether they stick—we need to explore two starkly different narratives.

China the scapegoat: a rule-follower that out-hustled the West

“Show me the cheating,” argues economist Don Diego De La Vega, pointing to Beijing’s track record at the World Trade Organization. Since joining the WTO in 2001, China has won more disputes than it has lost—a record that rivals the United States and European Union. The country’s competitive edge, Diego insists, was forged in classrooms and factories, not in back-rooms. OECD PISA tests show students from China’s coastal provinces comfortably topping global league tables in maths, science and reading—often while spending far less per pupil than Western systems. Those graduates now feed an industrial base that pumps out everything from nuclear reactors to e-vehicles. Diego’s bottom line: talent, not trickery, explains why China’s annual manufacturing output equals that of the next eight countries combined. Western shoppers relish the low-cost goods, he says, yet still cry foul whenever Beijing wins the productivity race.

The currency question: myth of a permanently undervalued yuan

Critics regularly accuse Beijing of currency manipulation. Yet the yuan has appreciated markedly against the dollar over the past two decades, outpacing all but a handful of safe-haven currencies. When the U.S. Treasury briefly branded China a “currency manipulator” in 2019, the label was dropped within five months—a move widely viewed as political theatre. Diego argues that propping up an undervalued currency for decades would be wildly expensive—and unnecessary for a country that can already compete on quality. In his view, the charge is less about economics and more about Western discomfort at losing market share.

Should the West answer with tariffs and industrial shields?

If protectionism is self-harm, Diego quips, Washington and Brussels keep reaching for the same hammer. He notes that talk-show pundits denounce former President Trump’s tariffs as “economic suicide,” then pivot moments later to demand new EU import taxes on Chinese solar panels. Such flip-flops, he says, mask a deeper unease: Western economies have under-invested in the skills and infrastructure that power China’s export machine.

China the cheat: a strategy built on rigged odds?

Economist Pierre Bentata holds the opposite view. In his telling, Beijing games the system by freezing the yuan at roughly 30 % below fair value, giving exporters an artificial leg-up. He also highlights selective market access: U.S. tech firms face near-total bans while Chinese start-ups enjoy a captive billion-user sandbox—classic “infant-industry protection” that the WTO was meant to curb. Intellectual-property enforcement remains patchy, Bentata adds, even if headline seizures of fake handbags have slowed. The bigger worry is forced tech transfer, where foreign firms must share know-how to reach Chinese consumers. The practice skirts WTO rules yet persists in strategic sectors such as EV batteries and avionics.

Subsidies, overcapacity and the “developing-country” card

Beijing still claims developing-nation perks at the WTO, allowing it to delay full tariff liberalisation and shower strategic champions with subsidies. When state-backed steel or solar giants dump excess output abroad at rock-bottom prices, European mills struggle to stay open. Western governments do the same in agriculture or aerospace, Bentata concedes—but China’s scale makes the fallout global.

Who really wins—and who pays the bill?

Bentata argues that China’s export-led model underprices its own labour, holding back domestic purchasing power and delaying the rise of a robust middle class. Diego counters that Western consumers reap the windfall: inexpensive smartphones and fast fashion subsidised by Chinese savings. Both economists agree on one point: the strategy is unsustainable. China must nurture internal demand to escape the “factory of the world” trap, while the West must invest in productivity rather than erect ever-higher tariff walls.

Mastermind or scapegoat?

The evidence suggests Beijing is both shrewd strategist and opportunistic rule-bender. It pushes every clause to the limit, yet rarely tears up the rulebook outright. For critics, that is cheating in all but name; for supporters, it is playing the game the way the game was designed. Either way, the debate tells us as much about Western angst as it does about Chinese policy. Until Brussels, Washington and others confront their own competitiveness gaps, Beijing will remain an easy target—and a convenient excuse—for the hard work still to be done at home.