TRADE: China’s Admission Will Change WTO

By Gustavo Capdevila Reprint | | Print |

Gustavo Capdevila

GENEVA, Sep 18 2001 (IPS) - China’s admission to the World Trade Organisation (WTO), which overcame one of the last obstacles Monday, will have a major impact on international trade and on the political balance within the multilateral institution.

The working group made up of the WTO’s 142 members, which has been discussing China’s accession for the past 15 years, approved the agreement based on which China will liberalise its trade regime and open its doors to foreign investment.

The accord must still be ratified by the Nov 9-13 conference of WTO trade ministers in Doha, Qatar, and by China’s National People’s Congress.

WTO authorities and trade negotiators said the significance of Monday’s decision was enormous. WTO Director Mike Moore said it was a defining moment in the history of the organisation and the multilateral trade system.

With the membership of a country that accounts for one-quarter of the world’s population, “the WTO will take a major step towards becoming a truly world organisation,” said Moore.

China’s deputy minister of trade Long Yongtu described China’s incorporation as a “win-win” situation for all.

“The great potential of China’s market will be gradually translated into purchasing power, so as to provide a huge open market to all countries and regions in the world,” said Long.

Having China in the WTO and subject to the same rules governing the rest of the world’s countries will have a positive effect on the global economy, agreed Federico Cuello, a negotiator from the Dominican Republic.

China’s admission must be analysed in the light of the difficult situation facing the world economy today, marked by a dramatic slowdown in the United States and Europe and recession in Japan, he pointed out.

The WTO Secretariat was also confident that the new member would revitalise an organisation that has been weakened by discrepancies among its members regarding the real benefits of the freeing up of trade.

Moore was pleased that China’s admission would enable the WTO to play “a pivotal rule in underpinning global economic cooperation.”

In the view of developing countries, China could become an important force in achieving more equitable results in the future, said Uruguayan representative Carlos Pérez del Castillo.

China’s presence will help to correct the “assymetries” seen in WTO accords, and to pursue objectives that have long been postponed in areas that are vital to poor countries, like agriculture and textiles, said Pérez del Castillo.

However, it is still unclear what role China will play in an organisation characterised by often profound disagreements between the blocs of industrialised and developing countries.

The Chinese delegation said China’s adherence to the institution that regulates the liberalisation of trade and the world’s economies was “in line with China’s reform and opening-up policy and the goal of establishing a socialist market economic system.”

Pérez del Castillo ruled out the possibility of China becoming a leader of the world’s developing countries, saying it had failed to do so within the United Nations, and adding that “I don’t see why” it would do so in the WTO.

But there is no doubt that China’s presence, political clout and market size will have an impact when it comes to achieving specific objectives, said the Uruguayan negotiator, who welcomed the incorporation of the giant new member.