Chinese Premier Li Qiang, on the sidelines of the UN General Assembly in New York, said that China will no longer seek SDT in existing and upcoming WTO agreements, according to the Chinese state-run news agency Xinhua.

"This is a culmination of many years of hard work and I want to applaud China’s leadership on this issue," WTO Director-General Ngozi Okonjo-Iweala said in a post on the US social media company X, hailing it as "major news key to WTO reform."

China defined itself as a developing country while boasting the world’s second-largest economy, which allowed it the right to benefit from SDT by placing higher customs tariffs and using subsidies.

The US claimed that the SDT system provided unfair advantages to developing countries, suggesting that no significant reform to the WTO could come to the fore as long as countries like China and other major economies benefit from SDT.

China was first unclear on relinquishing its developing country status or simply waiving its privileges.

The Chinese Commerce Ministry said the country’s developing status will remain, but related benefits, such as longer periods to implement WTO rules, will no longer apply, while the waiver can be revoked at any point.   

China 'will always be a developing country'

A senior delegate from the Chinese mission to the WTO in Geneva said on Wednesday that this decision "does not involve any change to China's status as a developing country and in the WTO as a developing member, whether within the WTO framework or in any other context."

"China remains a key member of the Global South and will always be a developing country," Li Yihong, the charge d'affaires, told reporters.

She said the step reflects "a concrete measure taken by China to proactively assume responsibility and demonstrate the commitment of a major developing country," adding that it "underscores China's firm stance in supporting the multilateral trading system through concrete actions" and would "inject positive energy into advancing the WTO's current discussions, especially the reform of the global economic governance system."

China's decision relates solely to forgoing new SDT provisions in current and future WTO talks and "has no implication and does not prejudice China's rights in other international fora," Li explained. Existing SDT rights under past WTO agreements will remain unaffected.

With this decision, she underlined that there is still "room to ask for the flexibility."

When asked by Anadolu whether China expects other major developing economies to follow suit, Li replied that Beijing "never asks others to follow our suit," adding: "It depends on their own decisions, according to their own situations."

However, she noted that "every responsible country should do what it can to send positive signals to the WTO" at this critical moment.

She emphasized that, while China has chosen to forgo new SDT provisions, it will continue to stand with other developing countries and "firmly uphold their legitimate rights and interests, including their rights to ask for SDT." 

China’s move came in as a signal to the rest of the Global South, which the country deems itself to be the de facto representative of.

China’s decision to withdraw from SDT benefits came after months of trade tensions with the US.

Meanwhile, the WTO is reportedly facing increasing challenges due to its failure to reform itself with evolving global economic and trade conditions amid trade wars, while the call for reform from within the organization is on the rise.