World Trade Organization
United States to Back Early WTO Entry for China
By July 1 next year, the day Hong Kong reverts to Chinese sovereignty, United States trade negotiators would like to have China become a full member of the World Trade Organization. It appears that it would be difficult to check if Chinese exporters were illegally taking advantage of Hong Kong's status as a WTO member, so officials in Geneva confirmed that China's entry was desirable before the handover. Once China's application is accepted, the U.S. will insist that Taiwan be brought in simultaneously, sources said. Washington's desire to have a more constructive relationship with Beijing has sped up the momentum of China's entry. "We are aiming for the Hong Kong handover and all things being equal, we hope we can achieve it," a U.S. officials said.
South China Morning Post (Hong Kong), 11/27/97
China's Foreign Ministry Claims Politics Keeping China Out of WTO
Shen Guofang, spokesman for China's Foreign Ministry, said that China is already qualified for entry into the WTO. China's ten years of economic reforms have brought most of its trade practices into line with international norms. Mr. Shen felt that China was being excluded from the organization for political considerations. Although the WTO conference in Singapore failed to agree on China's participation in WTO, Mr. Shen said that China would continue to push for acceptance into the trade body as a developing nation. Should China not join the organization, however, the country would continue its reform process and increase bilateral trade, to the detriment of WTO and other countries.
China Daily (PRC), 12/13/96
Mixed Signals on China's Enthusiasm for WTO
A Chinese Customs Administration official said that China was "indifferent" to entering the WTO after years of tedious negotiations. The official said that top Chinese leadership felt the WTO process was "politically tainted" and no longer cared about entry. However, Foreign Ministry representatives were quick to reply that China position on WTO is unchanged, and it continues to seek a seat in the trade body. Observers felt that the comments indicated internal differences on the role of global trade in China's development and also that China was in no hurry to make concessions to gain entry into WTO.
Asian Wall Street Journal (HK), 12/18/96
China's Position on WTO May Soften
China's chief WTO negotiator was reported as saying that China will no longer seek developing country status across the board in its WTO membership bid, but would instead only seek protection for those industries heavily threatened by international competition. The State Economic and Trade Commission also listed concessions made by China on WTO entry, including the reduction of the overall tariff rate from 23% to 15%, reduction of non-tariff barriers by 2010 and elimination of such barriers by 2020, increasing the number of cities in which foreign banks can operate to 24, increasing the number of cities in which foreign retailers can operate to 11, allowing foreign insurers to operate outside Beijing, Guangzhou, and Shanghai, allowing foreign firms larger stakes in power projects, and permitting foreign travel agencies to operate in five Chinese cities by 2000.
EIU Business China (HK), 01/06/97
China Willing to Compromise to Enter WTO
Bowing to American pressure, China's chief World Trade Organization negotiator said that China will no longer ask for full developing country status in its membership bid to the trade body. Rather, China will only seek protection for domestic industries that could be threatened by international competition. The State Economic and Trade Commission recently released a list of some concessions already made by the Chinese government in order to gain admission into the WTO. Included in this list is the reduction of China's overall tariff rate from 23 percent to 15 percent, to significantly reduce non-tariff barriers by 2010 and completely eliminate them by 2020, increasing the number of cities that foreign banks can operate to 24 and the number of cities which retailers can operate to 11, expanding the number of places insurance companies can operate in, the opening of some cities to foreign travel agencies and allowing foreign firms a larger stake in domestic power projects.
Beijing Scene (U.S./PRC), 01/31/97
China Says It is Willing to Lower Trade Barriers
In a move to help it be admitted into the World Trade Organization, U.S. officials said that China is ready to put an end to many of its biggest trade barriers which include policy shifts in some industries run by the state and military. For the first time China is discussing changes in specific laws, many of which are burdensome to foreign investors, said Secretary of Commerce William Daley. He said he was encouraged by the development but was waiting to see Beijing's offer put to writing. Another round of discussions are scheduled for the first week of March in Geneva. U.S. officials said they expect to see Beijing's latest offer in writing at that time. Among the regulations that Chinese may abandon are those that require foreigners to export the majority of what they produce in China.
UPI (U.S.), 02/12/97
China Changes Stance on WTO Access
Sources in Geneva say that China is ready to put aside its insistence that it be considered a developing nation as a means to help it obtain entry into the World Trade Organization. It appears that there will be a new package of Chinese trade liberalization policies as the country focuses on becoming a secure member of the trade body. Discussions will take place on the issue on March 6 in Geneva to consider the progress that has been made. Privately, diplomats are expressing increasing optimism that some kind of a deal will be made. Developing country status for China was almost unanimously rejected by developed countries saying that for China to have such preferential status was unacceptable for so potentially large an economic power. Many countries have advocated a phased approach by lowering tariffs in some sectors over time along with immediate reform of other sectors. It is believed that China will accept this approach, allowing developing country status be applied to some sectors of its economy. It is also believed that under the new package China will immediately remove many of its non-tariff barriers like import licensing requirements and quotas. China may also lift several restrictions imposed on foreigners in access to its financial services sector. It will look for leniency for the state-owned sector, WTO delegates said.
South China Morning Post (Hong Kong), 02/23/97
Beijing's Plan to Control Financial News Set Aside
According to a U.S. trade official, China is committed to abandoning a controversial plan to demand that all foreign financial news agencies to first pass information through China's government-owned wire service before publishing it themselves. In China's bid to join the World Trade Organization, this reversal was conveyed last week to U.S. trade negotiators. Many complaints from the U.S. and other Western countries were made last year, causing a postponement of the plan, but until now, no commitment has been made to completely abandon it.
The Journal of Commerce (U.S.), 02/21/97
Talks This Week on China's WTO Bid
Trade officials said that China and other members of the World Trade Organization have made a decision to have intensive talks this week in order to speed negotiations on admitting Beijing to the WTO. Chinese negotiators will participate in three days of informal sessions of the WTO working party to work through major problems. Following the sessions will be a formal meeting of the body for all members late Thursday to see what has been accomplished and to agree on the date for more negotiations. A senior envoy from a major trading powers stressed the importance of this week and added: " We are still relatively far away from a deal but a lot of things could happen quite quickly if there is a real push and we get the right signals from China."
The Asian Wall Street Journal (U.S.), 03/04/97
China Inches Closer to World Trade Organization
Beijing has promised to do away with restrictions on state trading rights and apply national treatment to all companies, as a concession to enter the World Trade Organization. China's state-owned companies will have to prepare for the challenge of competition as in the past they have always leaned on preferential treatment from the government. However, now they will face domestic and foreign competition. "In the past, we never thought about competition. We enjoyed the quota and monetary assistance," Shanghai Machinery Import and Export Corp assistant-to president Jin Hui said. Long Yongtu, China's assistant foreign trade minister said in Geneva that China has agreed to allow domestic and foreign companies to import and export freely within three years. Analysts believe that state-owned firms will now have to refocus on the bottom line rather than merely business volume. Although foreign firms in Shanghai and other parts of China welcomed the news, they still had doubts that it would ever be implemented.
South China Morning Post (Hong Kong), 03/09/97
The WTO's Telecom Agreement Makes Membership Even Harder for China
China has been trying to get into the WTO for 11 years now and many believe this may be the year it does. However, the agreement to liberalize global telecoms may further delay and complicate China's aspiration. China now faces a serious choice: either make broad market access concessions or remain unrepresented in the trade body. China probably wishes the telecom agreement had failed as each WTO country has agreed to liberalize a range of telecommunications services. This agreement makes China's telecommunications market look almost hopeless. WTO nations are opening their doors to foreign telecom companies while China has only create Unicom to break the state monopoly. In China foreign firms still remain completely barred from operating or managing telecom networks. They may, however, lease Unicom's equipment and take a service revenue. So is China better off staying out of the WTO? This may be the case but would have consequences. The World Bank says that developing countries need $60 billion just to maintain their infrastructure. As capital seeks the highest return which comes from services in telecoms, why should any foreign firm waste their time in low-margin equipment supply contracts in China?
EIU Business China (U.K.), 03/03/97
China Still Coming Up Short on WTO Bid
Although much progress was being made in recent talks in Geneva, Beijing still has a long way to go to become a member of the WTO, said U.S. Undersecretary of Commerce, Stuart Eizenstat. The comments were made just after returning to Washington from a trip to China. Eizenstat said that even though some progress was made "we are still a long way from being at a point where accession is likely. In Beijing he spoke of the "corrosive" effect the huge U.S. trade deficit with China could be on relations if not promptly addressed. He said that while in China this time, officials appeared more willing to avoid the yearly fight over the issue and expressed a willingness to reduce market barriers and increase market access. He said that only time would reveal whether this would manifest into anything concrete. Any announcements on successful contract bids will likely be announced during Gore's visit to China next week.
Reuters (U.K.), 03/12/97
Tariffs to Increase on Beer, Oil, Video Cameras, and Film
China will begin collecting two new tariffs on July 1. A duty will be levied on foreign beer, crude oil, and camera film based on the product's size, and a separate duty plus a 3% tax based on value will be imposed on video cameras and recorders. The move is designed to counter the problem of importers undervaluing their products to Chinese customs authorities. While China has pledged to phase out existing duties on these products keep the overall tariff levels low for WTO accession purposes, the government remains anxious to protect some domestic industries. A customs official said that further details were being sorted out and a formal announcement would be made soon.
Asian Wall Street Journal (Hong Kong), 03/13/97
MOFTEC Still Sees Obstacles to WTO Accession for China
China's Ministry of Foreign Trade and Economic Cooperation (MOFTEC) issued a statement saying that while China has made great strides towards WTO accession, many unresolved issues remain to be negotiated. The statement noted China's large overall tariff cut, from 35.9% to 23% in April 1996, as well as MOFTEC Assistant Minister Long Yongtu's pledge to make foreign trade rights freely available in China in three years, as signs of progress. However, future success in the talks will depend on striking the proper balance of rights and responsibilities based on China's current level of economic development.
China Daily (PRC), 03/14/97
WTO Talks Tough but Progress Reported
Progress has been made in China's bid to become a member of the World Trade Organization but further steps may not be easy. Moftec said that although China "has made some major progress recently, but there are still many obstacles that remain to be overcome." Foreign Trade Minister Long Yongtu said that withing three years China would enable domestic and foreign investors to have foreign trade rights. Moftec said that issues remained on accession protocol and market access. "We are willing to continue our talks with all contracting parties because we firmly believe China needs WTO and WTO needs China," a spokesman for the ministry said.
South China Morning Post (Hong Kong), 03/15/97
WTO Bid Closer as Some Rules Eased
Last week China announced that within three years of joining the World Trade Organization, it will allow both foreign and domestic companies to import and export freely. Most foreign companies currently have to do trade through state-owned enterprises. Long Yongtu, China assistant trade minister said that some rights would be phased in over three to five years and would dramatically improve foreigners access to China's market. Long said that the Chinese government decided to fully enact the global rules on trade related intellectual property protection as soon as it becomes a WTO member.
The Journal of Commerce (U.S.), 03/11/97
Government Blames Politics for WTO Delay
Last Friday, Chinese Minister Li Peng put the blame on political reasons for China's entry delay into the World Trade Organization. However, he also emphasized that Beijing had the patience to wait for terms of entry that were acceptable to China. He was positive about recent signs of progress but said it was "abnormal" that China should have to wait so long. "Granted, economic interests have played a part in this, but there is no denying that this has also been due to political favors," Li said. "I can reiterate on behalf of the Chinese government that, after joining the WTO, China will fulfill it obligations," he added.
The Journal of Commerce (U.S.), 03/19/97
EU Disappointed With Beijing's WTO Trade Offer
Negotiators from the European Union said that they were very disappointed by the offers China made to joint the World Trade Organization. "The Chinese offer at this stage was below what we would call WTO standard, if there is such a thing," said EU team leader Gerard Depayre. Access to China's huge market is very important to the European service industry he said.
Agence France-Presse (France), 03/20/97
China Offers Automotive Concession for WTO
As a concession to membership to the World Trade Organization, China recently offered to accelerate the abolition of non-tariff barriers on auto imports. According to a Japanese trade official, the compromise was offered at the latest meeting in Geneva between WTO members and Chinese trade officials.
South China Morning Post (Hong Kong), 03/27/97
China's Credibility Liked to WTO Accession
A recent Japanese trade policy report said that if China failed to become a member of the WTO it would jeopardize the country's future development. Expeditious accession for China and Taiwan was important not only to the countries themselves but the world as it would foster the expansion of global trade through increased liberalization of their trading regimes. Membership would also bring the countries under common rules and a place for multilateral dispute settlement. "The accession will also promote further integration of China into the global economy," the report said. If China should fail to accede, however, it could "seriously damage the credibility of the Chinese economy. Trade and investment from the rest of the world that are essential for its further development will also suffer." If China were left outside the WTO it would still play a major role in the world economy and be a growing burden for the world trading system, the report noted. However, China should make clear its commitment to follow WTO rules. It should provide a clear timetable for eliminating import restrictions in a completely transparent way, the report suggested. Subsidies, trade related aspects of investment measures, industrial policy measures and protection of IPR also needs to be addressed by Beijing. One of the greatest concerns is China's restrictions in the distribution sector, which remain a substantial barrier to trade.
South China Morning Post (Hong Kong), 04/01/97