Trade Policy Review: China
This fourth Trade Policy Review (TPR) of China has provided Members an opportunity to conduct a collective appreciation and evaluation of the full range of China’s trade policies and practices and their impact on the functioning of the multilateral trading system. I wish to thank the Chinese delegation, headed by H.E. Mr. Yu Jianhua, Assistant Minister in the Ministry of Commerce, for their active participation and H.E. Ambassador Steffen Smidt of Denmark for his valuable contribution as the discussant. The keen interest shown by Members in this Review, as reflected in the large number of statements made and of advance written questions posed, testifies to the important role played by China in international trade and in the WTO. The TPRB appreciates China's responses to the questions it received, and looks forward to receiving any outstanding answers within a month.
This TPR of China has taken place against the background of the lingering effects of the global financial and economic crises and the difficult economic situation that continues to prevail. Prompt actions by China through fiscal stimulus and prudential monetary policies were welcomed. It was noted that this had resulted in domestic demand playing a substantially more important role in China's growth in recent years and to some easing of macroeconomic imbalances that had been remarked on in previous reviews. Members commented on the important role that a well-functioning multilateral trading system plays in helping China to sustain its growth and development, and were encouraged to note that China has kept its markets open and resisted protectionist pressures during this difficult period.
Many Members commended China’s constructive role in the WTO in seeking ways to advance the Doha Development Agenda, particularly its development dimension, in encouraging South-South cooperation, in assisting LDCs’ accession to the WTO, in offering zero tariffs for imports from 36 LDCs and the Chinese President’s recent announcement that China is raising its DFQF treatment to 97%.
It was noted that multilateral transparency plays a critical role in the functioning of the WTO Agreements and in giving practical meaning to market access opportunities for the traders and investors of all Members. China was encouraged to continue to build on the progress it has made by fulfilling all of the WTO's transparency requirements, including by providing full and prompt notifications of its trade and trade-related measures.
This Review has highlighted some key areas for further actions or improvements. I note from China’s statements delivered Tuesday and this morning that action is already being taken or is being considered in several of these areas. I have also taken careful note of China's continued willingness to discuss with Members issues where further clarification or solution of problems is deemed necessary:
- Standards, SPS, and other technical requirements: Members urged China to enhance the transparency of its standards, technical regulations and SPS measures, particularly by taking further steps such as notifying more measures and providing more opportunities for consultations with its trading partners prior to introducing new measures. China was also encouraged to simplify its conformity assessment procedures and to use international standards to a greater extent.
- Intellectual property rights: Members appreciated that China has promulgated or amended a number of laws, regulations, and departmental rules regarding the protection of intellectual property rights and its domestic dispute settlement. However, concerns were expressed about China's current practices regarding the protection of trademarks and technology transfers. Some views were also expressed about the need to strengthen enforcement aspects of intellectual property rights.
- Agriculture: Members noted that the value of agriculture production and the amount of government support to agriculture had increased considerably over the past few years, and that China is now the world's largest producer of several major agricultural products, including rice, cotton, wheat and potatoes. Many Members asked for more information on China’s agriculture programmes and urged China to bring its WTO agriculture notifications up to date.
- Government procurement: China was encouraged to submit its revised offer as soon as possible in the context of acceding to the Agreement on Government Procurement. It was noted that China had decoupled its government procurement practices from its indigenous innovation initiative. Members were interested to have more information about procurement activities at the sub-central level.
- Services: Some Members felt there is room for improvement in market access and investment conditions in: banking, insurance, securities, construction, telecommunications, express delivery, legal services, electronic payments, logistics, and transport. Capital requirements, branching restrictions, licensing procedures, regulatory processes and informal bans were particularly mentioned as areas where obstacles need to be removed.
- Contingency trade measures: Concerns were expressed about the impacts of China’s increased resort to anti-dumping and countervailing measures, and about procedures such as the transparency of investigations, remedial measures proportional to the injury and the length of time some individual measures have been kept in place.
- Subsidies: Members welcomed that in 2011 China had submitted its new notification of subsidies covering the central government’s assistance programmes for the period 2005-2008. However, it was noted that very little information is available on sub-central level subsidy programmes and China was urged to update its subsidy notification to cover the last three years on a comprehensive basis. China was also encouraged to notify its fisheries subsidies.
- Export regime: Many Members expressed concerns over aspects of China’s export regime, notably: restrictions, licensing, quotas, export taxes and partial VAT rebates.
- State-owned enterprises and competition: It was noted that state-owned enterprises continue to play a central role in China's economy and foreign trade, and China was encouraged to take more steps to ensure a level-playing field for competition among enterprises irrespective of their ownership.
- Customs procedures and non-tariff border measures: China was encouraged to continue streamlining its customs procedures and to make other trade facilitation improvements. China was also encouraged to increase the transparency of its import licensing procedures.
Overall, this fourth Trade Policy Review (TPR) of China has given us a sense of China’s growing importance in the world economy in general and in the multilateral trading system in particular. I am sure that the Chinese delegation — ably led by Assistant Minister Yu — is today more aware than ever about their country's role in the world of international trade and about the increased responsibilities that come with it. We hope that this exercise will serve the Chinese Government to continue to reflect on its trade policies and how they can continue to have a positive impact on the multilateral trading system and the world economy in the years to come.
Finally, let me say that I leave this session heartened by the hope that a deeper, more intense dialogue between China and the rest of the Members of the WTO will emerge out of this exercise. I thank Assistant Minister Yu for his statements this morning in that regard.
Let me thank again Assistant Minister Yu and his delegation for their constructive efforts in preparing for and participating in this Review.