The aim of this research is to analyze the macroeconomic performance of developed countries after China’s accession to WTO. Despite of strong internal and external pressures, China achieved the membership status in WTO in 2001. Time series and cross-sectional data indicate that the implication of this accession has become highly positive for China and substantially negative for developed countries. Thus, the imports of developed countries from China have increased considerable more than their exports to the rest of the world. This has resulted with deficits in foreign trade account of developed countries. In addition, foreign investors were encouraged to invest in China because of its comparative advantages in international trade. This has slowed the economic growth and worsened macroeconomic performance of developed countries. Thus, worsening of macroeconomic performance after the accession in developed countries was mainly sourced from the deficits in international trade and flow of capital with China. Consequently, increasing of trade deficit with China and budget deficits as a result of expansionary fiscal policy has leaded to the foreign borrowing which resulted with huge government debt in developed countries.