By Hasan Muhammad

Editor's Note: The writer is a freelance columnist on international affairs based in Karachi, Pakistan. The article reflects the author's opinions and not necessarily the views of China Economic Net.

Just days after China's customs agency reported a record $1 trillion surplus, leaders from the International Monetary Fund, World Bank, and World Trade Organization gathered in Beijing for the "1+10" Dialogue. The message from the host was clear and unyielding: tariffs inflict mutual harm, and the time for multilateral action has come. With growth on track at 5 percent despite external pressures, China positioned itself as a steward, urging partners to safeguard open markets amid a year of volatility.

The timing could not have been sharper. November's export rebound masked deeper strains: factory activity contracted for an eighth month, new orders faltered, and domestic demand lagged. Yet Beijing's voice carried weight. Officials emphasized that trade restrictions, proliferating since early 2025, have slowed global activity by squeezing supply chains and inflating costs. The consequences, they argued, grow clearer by the month, with calls for free trade echoing from Geneva to Nairobi.

This stance reflects a broader strategy. China has avoided fresh stimulus, opting instead for targeted infrastructure boosts that stabilize without inflating debt. The surplus, while headline-grabbing, stems from diversification: exports to non-U.S. markets surged as American shipments plunged. But leaders warned that without collective restraint, squeezed economies might erect their own walls, dooming all to stagnation. The plea was for reform, not retreat: enhance dialogue to resolve frictions and foster win-win outcomes. In bilateral meetings, commitments flowed to open China's vast market wider, inviting foreign firms into high-tech and green sectors.

The forum's outcomes hint at progress. Discussions touched on artificial intelligence's role in trade, from predictive logistics to borderless data flows, underscoring how technology could knit economies closer. Commitments emerged to bolster the World Trade Organization, long weakened by disputes, and to expand initiatives like the Asian Infrastructure Investment Bank for sustainable projects in the Global South. China reaffirmed support for the United Nations-centered system, pledging resources to help developing nations weather tariff storms.

Tariffs have not curbed China's output; they have merely shifted it. Beijing's approach counters with inclusion: by sharing its mega-market, China absorbs global overcapacity while lifting partners. Exports to ASEAN, now up 8.2 percent, exemplify this, fueling regional factories without the strings of conditional aid.

The real test lies ahead. With 2026 looming, protectionism could harden if growth falters. China's 5 percent trajectory offers stability, but global forecasts hover at 3 percent, per IMF estimates, dragged by trade frictions. The dialogue's call for openness addresses this head-on: multilateral pacts to protect chains, reforms to boost consumption worldwide, and tech cooperation to unlock new drivers. For the Global South, where tariffs hit hardest, Beijing's model shines. Nations like Indonesia and Brazil gain from stable supplies of machinery and renewables, enabling their own industrial leaps.

Tariffs, once a blunt tool, now reveal their limits: they punish senders and receivers alike, fostering resentment over partnership. China's insistence on dialogue charts a path out, one where shared governance replaces silos. If partners heed it, 2026 could mark recovery's dawn. Ignore it, and the fractures deepen.

Meanwhile, developing nations are watching warily. Now they need markets, not just roads. Indonesia’s nickel refiners and Chile’s lithium producers thrive on Chinese demand, yet fear being caught in great-power crossfire. The “1+10” Dialogue offered them a seat at the table - rare for forums traditionally dominated by G7 voices - and they seized it, extracting pledges for technology transfer and preferential financing.

The WTO’s dispute system remains paralyzed, but new plurilateral deals on digital trade and critical minerals are quietly advancing. Supply-chain mapping initiatives, seeded at Diaoyutai, now involve 42 countries sharing real-time data to prevent future shortages. These are modest steps, yet they point toward a system where resilience is built collectively rather than hoarded nationally.