Recalibration, Shielding and Containment: How the World Trading System De-risks from China and the United States

Abstract The two economic superpowers operate increasingly outside WTO norms. China's reliance on non-market practices challenges the competitive equality among WTO members, while the US, under a second Trump administration, has unilaterally raised tariffs in defiance of multilateral rules. This essay examines how the rest of the world is de-risking from the two rogue superpowers while shoring up trade multilateralism. It identifies three interlinked strategies: (1) recalibration – reducing trade dependency through targeted trade remedies against China and narrow bilateral agreements with the US; (2) shielding – collective and unilateral responses to economic coercion of both superpowers; and (3) containment – preventing illegality from spreading to the rest of the world. Together, these modes of governance not only mitigate systemic spillovers from rule-breaking but also help rebalance global trade by addressing structural imbalances in Chinese overproduction and US overconsumption. In doing so, the rest of the world may lay the groundwork for a renewed and more resilient multilateral trading system.