When the hegemon goes rogue: leadership amid the US assault on the liberal trading order

Abstract

Abstract Under President Trump, the United States abdicated its traditional leadership role in the trading system, abandoning multilateralism for aggressive unilateralism and launching an active assault on the World Trade Organization (WTO). Most strikingly, the US blocked appointments to the Appellate Body, jeopardizing the WTO's dispute settlement mechanism. With the trade regime in crisis, a key question has been whether other states would have the will and capacity to lead system-preserving initiatives. While most attention has focused on whether China—widely seen as the chief hegemonic challenger to the US—would assume the mantle of leadership, there has been considerable scepticism about the European Union's capacity to exercise leadership amid the crisis. The EU has generally been seen as punching below its weight in terms of leadership at the WTO. In this article, however, I argue that it is the EU, rather than China, that has taken the lead in advancing concrete initiatives directed at defending and maintaining the multilateral trading system. The EU led the creation of an interim appeals arrangement to replace the defunct Appellate Body—in effect, creating an ‘Appellate Body minus the US’. Although the rules-based multilateral trading system remains under threat, it is the EU, not China, that is acting as a system-preserving power, leading efforts to defend the established order.