Lex_China and the WTO: a good thing

Lex专栏：中国入世10年

It is exactly 10 years since China concluded negotiations to join the World Trade Organisation, after a decade and a half of demurring. Commerce minister Chen Deming chaired a celebratory forum in Xiamen this week entitled “Openness, co-operation and win-win”.

Not quite. Yes, China is co-operating. After a diffident start, it has evolved from a passive taker of the existing rules to a member that will “shake” the rules for its own interests or even make new ones, notes Henry Gao of Singapore Management University. That is a good thing. And if “openness” implies compliance with the commitments China made in its accession package, here, too, the record is broadly positive.

Granted, China is better at complying with rules that require a specific action, such as scrapping or reducing tariffs, than those that require adherence to principles, such as not favouring domestic enterprises, or treating all WTO members equally. No nation has entered into bilateral trade agreements over the past 10 years quite as enthusiastically as China.

As for “win-win”, well, China is certainly winning. In 2000 it was the world’s seventh largest exporter and eighth largest importer of merchandise; in 2010 it was number one and two, respectively. (It has leapt to four and three in services, from 10 and 12.) As ING points out, accession to the WTO marked an acceleration of real annual gross domestic product growth from 9 per cent (1992-2001) to 11 per cent (2002-2008). Two-way trade for most nations in China’s orbit has also risen dramatically. But, as America’s increasingly critical assessments of China’s WTO compliance suggests, those trading partners do not always feel like winners. During its relatively brief membership, the world’s second-largest economy has responded to 22 complaints – more than the next three put together.



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