China and the United States have blamed each other for risking the destruction of the World Trade Organisation, with Beijing's ambassador decrying US hostage-taking and Washington's envoy calling China's claims "Alice in Wonderland".
US Ambassador Dennis Shea, addressing the WTO's General Council for the first time, began by attacking the judges of the WTO's Appellate Body, whom he blamed for a "steadily worsening rupture of trust".
"Something has gone terribly wrong in this system when those charged with adjudicating the rules are so consistently disregarding those very rules," Shea said.
The United States has vetoed new appointments to the Appellate Body, causing a crisis at what is effectively the supreme court of world trade.
Shea said the judges had overstepped their authority and had broken the rules by failing to observe a 90-day timetable for judging appeals. Many experts say the delays are caused by ever-more complicated disputes piling up in a congested system.
Chinese Ambassador Zhang Xiangchen, who had put the issue on the agenda, began by warmly welcoming "our new colleagues, especially Dennis". But the cordial opening gave way to criticism of the "dangerous and devastating" US actions.
"By taking the selection process as a hostage, the US is abusing the decision-making mechanism of consensus," Zhang said.
The US veto, along with steel and aluminium tariffs and a threat to put $50 billion of tariffs on Chinese goods for alleged intellectual property theft, had systemically challenged the WTO's fundamental principles, he said.
"Any one of these, if left untreated, will fatally undermine the functioning of the WTO. But the reality is that the WTO is currently confronted with 'three hard blows'," Zhang said.
The United States was reportedly seeking export limits from countries in return for exemptions from its steel tariff, which was "explicitly prohibited" by the WTO rules, he added.
China denies US accusations that it trades unfairly by subsidising steel production and coercing foreign firms to transfer technology to Chinese competitors. Shea said he was "perplexed" by China's assertion that it was a victim.
"Mr Chairman, we have now entered the realm of Alice in Wonderland. White is black. Up is down," he said.
