China's entry into the WTO with a little help from the EU

International Affairs

Volumn 73, Issue 3, 1997, Pages 489-507

  Eglin, Michaela ^a  

^a NONE

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[No Author keywords available]

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EID: 0008727548     PISSN: 00205850     EISSN: None     Source Type: Journal    
DOI: 10.2307/2624269     Document Type: Article

References (30)

1. See Annual Report 1996, WTO, vol. II, p.4.
2. See Kathy Chen, 'Chiang moves China toward privatization', Asian Wall Street Journal, 7 April 1997. Data based on Merill Lynch North Asia Monthly.
3. The Results of the Uruguay Round of Multilateral Trade Negotiations, Legal Texts', is usually referred to as the WTO Agreement, but in fact comprises a large number of Agreements of which the GATT is an integral part, referred to as GATT 1994. WTO, Geneva, 1995.
4. Basic Instruments and Selected Documents (BISD) and their Supplements, GATT, Geneva (annual records of GATT proceedings, working party reports and protocols of accession).
5. China's external trading volumes (exports and imports) in 1996 were US$60 billion, 42.8 and 39.7, respectively, for Japan, the US and the EU according to data based on China's Customs Administration. External trade grew at a rate of 3.2 per cent in 1996, a substantial slowdown compared with the double digit growth rates over the previous five years. See 'Chinas Aussenhandel auf der Kriechspur' (Slowdown in China's external trade). Neue Zürcher Zeitung (NZZ), 17 Jan. 1997.
6. For example, after reaching a US-China eight-point agreement on 11 March 1995 (inter alia on China's resumption of implementation of the 1992 Memorandum of Understanding on market access, which was suspended following the collapse of negotiations in December 1994; on US market access in agriculture; and on US support of China's accession as a founding member and a realistic consideration of China's developing country status), then US Trade Representative, Mickey Kantor, told the US International Business Council on 15 May 1995, 'all we said and agreed to is that for certain purposes, China is a developed country and for certain purposes it is a developing country'. Shortly thereafter, administration officials insisted that the US position on China's entering the WTO on a commercial basis remained unchanged. See 'US insists position remains unchanged on China entry into WTO', Inside US Trade, 17 March 1995.
7. Protocols of Accession and Working Party Reports relating to these accessions are recorded in the BISD, various issues, GATT (WTO), Geneva.
8. Although technically it was still within China's reach to fall under the previous system until two years after the WTO Agreement entered into force, i.e. January 1997, stalled negotiations prevented such an outcome. It would be pure conjecture to assume that there was determined strategy at work to foil China's aspirations. However, had China succeeded in resuming its GATT seat, it would have been technically impossible for a contracting party to invoke GATT's non-application clause (Article XXXV).
9. See 'Brüssel strebt Ubergangslösung für Chinas WTO-Mitgliedschaft' (Brussels strives for transitional solution to China's WTO membership. Interview with Sir Leon Brittan), Handelsblatt, 8 Nov. 1994.
10. See Personal View, Leon Brittan, 'New Tactics for EU trade', Financial Times, 11 Nov. 1996.
11. Leon Brittan has been seeking to expand the Commission's authority , as the unanimity rule hampers negotiating strength and leads to lowest common denominator decisions. See Lionel Barber, 'Brussels strives to call the tune on trade', Financial Times, 12 March 1997.
12. See also Testimony of the Honorable Charlene Barshefsky, Deputy US Trade Representative before the House Ways and Means Committee Subcommittee on Trade, 23 May 1995, http://www.ustr.gov/testimony/barshefsky_2.html.
13. At the same time, US consumers would suffer from the increase in domestic prices this would entail. According to the Congressional Research Service, US consumers would lose almost US$30 billion a year if the US decided to withdraw MFN status from China. This amount includes costs arising from China's likely retaliation by reducing imports from the US and the negative consequences on US employment and investment activity. See Kyodo News International, Inc., 'No MFN for China to cost US consumers...', Washington, 27 Nov. 1996.
14. The US alluded to such an approach in March 1995, see n. 6 above.
15. See 'Europäische Union setzt Peking stärker unter Druck' (EU exerts increased pressure on Beijing), Handelsblalt, 16/17 March 1996.
16. Ibid.
17. Statement by Mr Long Yongtu, assistant minister of the Ministry of Foreign Trade and Economic Cooperation (MOFTEC) and head of the Chinese negotiating team. 1 Nov. 1996, Geneva, WTO.
18. See GATT 1994, Article XVIII and addenda thereto. WTO Agreement, Legal Texts.
19. See Edmond McGovern International trade regulation (Exeter: Globefield, 1982), pp. 212-15.
20. According to Title V of the US Trade Act of 1974 (as amended).
21. See Wu Jie, ed., China economic systems reform yearbook (Beijing: China Reform Publishing House, 1995), Table 70, p.280. Per capita net income of rural families was 2,224 Yuan and of urban families 3,179 Yuan, representing respectively a 355 per cent and a 274 per cent increase since 1978. The Yuan figure is here converted at the official exchange rate of 1$=8.5 Yuan prevailing in 1994. The World Bank's World Development Reports (1994) estimated China's GDP per capita in 1992 at US$470, adjusting for statistical, price and exchange rate factors. An alternative estimate based on the purchasing power parity method amounted to US$1910, subject to wide margins of error with an upward bias.
22. See Wu Jie, ed., China economic systems reform yearbook (Beijing: China Reform Publishing House, 1995), Table 70, p.280. Per capita net income of rural families was 2,224 Yuan and of urban families 3,179 Yuan, representing respectively a 355 per cent and a 274 per cent increase since 1978. The Yuan figure is here converted at the official exchange rate of 1$=8.5 Yuan prevailing in 1994. The World Bank's World Development Reports (1994) estimated China's GDP per capita in 1992 at US$470, adjusting for statistical, price and exchange rate factors. An alternative estimate based on the purchasing power parity method amounted to US$1910, subject to wide margins of error with an upward bias.
23. See WTO 1996, Annual Report, pp. 18-19, and 4-5, respectively.
24. See Sheel Koohli, 'Mainland wins support over breakthrough reform plans', South China Morning Post, Geneva, 7 March 1997 (the draft protocol has also been published on the Inside US trade web site http://www.insidetrade.com).
25. See Foo Choy Peeing, 'Long way to go for China's entry', in South China Morning Post, 7 March 1997, Shanghai. According to US Under-Secretary of Commerce Stuart Eizenstat, China had asked to be considered as a market economy for the purpose of anti-dumping procedures, but generally took the position to 'come in as a developing country'.
26. See Sophie Roell, 'China offers to cut tariffs to 15%', Financial Times, 26 Nov. 1996.
27. Agreement on Implementation of Article VI of the GATT 1994, Article 15, Legal Texts, WTO Geneva.
28. WTO Legal Texts, Agreement on Safeguards, Article II, WTO Geneva, p. 321.
29. Agreement on Textiles and Clothing, ibid., p. 85.
30. See BISD, 33rd Supplement, 1987, p.139.