Sunday

21st Jul 2019

Stakeholder

China supports and upholds multilateral trading system

  • China and the EU are actively engaged in communication and coordination on the modernisation of the WTO (Photo: Bank of China)

This year marks the 40th anniversary of China's reform and opening-up and also the 17th anniversary of China' accession to the World Trade Organization (WTO).

Since its entry into the WTO, China has been a strong advocate for free trade. China has faithfully fulfilled its accession commitments, substantially opened its market to the world, and firmly upheld the multilateral trading system, injecting strong impetus into the world economy.

Comprehensively aligning its business environment with international economic and trade rules, and earnestly fulfilling its accession commitments

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China significantly lowered import tariff rates and non-tariff barriers, liberalised the right to trade, boosted the services sector and reduced restrictions on foreign investment.

After its accession, China launched major efforts to review and revise relevant laws and regulations, involving 2,300 laws, regulations and departmental rules at central government level, and 190,000 policies and regulations at sub-central government levels.

By 2010, China had fulfilled all of its tariff reduction commitments, reducing the average tariff level from 15.3 percent in 2001 to 9.8 percent.

In terms of trade in services, China had honoured all of its commitments by 2007. Meanwhile, China built an intellectual property rights (IPR) legal system that conforms to WTO rules and suits its national conditions.

Since 2001, intellectual property royalties paid by China to foreign right holders has registered an annual growth of 17 percent, reaching $28.6bn in 2017.

Upholding free trade, supporting multilateral trading system

Since acceding to the WTO, China has played an active role in liberalising and facilitating trade and investment, effectively safeguarded the dispute settlement mechanism, vigorously supported the integration of developing members into the multilateral trading system, and firmly upheld the authority and efficacy of the multilateral trading system.

China explicitly opposes unilateralism and trade protectionism.

During the 22nd Asia-Pacific Economic Council economic leaders' meeting, the G20 Hangzhou summit, and the 9th BRICS (Brazil, Russia, India, China, South Africa) summit, China secured statements on opposing trade protectionism in the outcome documents of these summits.

China supports the independent and impartial role of the WTO appellate body, and joined more than 60 members in submitting a proposal on starting the selection process at the earliest possible date.

China participated fully in the Doha Round negotiations, and encouraged a number of countries to complete their domestic ratification procedures of the trade facilitation agreement.

The Least Developed Countries (LDCs) and accessions program, established by China, has helped six LDCs accede to the WTO.

With a view to better safeguarding free trade and adapting to the changing tides of global economy and trade, China and the EU are actively engaged in communication and coordination on the modernisation of the WTO, one of the important outcomes achieved at the recently concluded 20th China-EU Summit.

Living up to its responsibility as a major country

After its accession to the WTO, as it rapidly integrated into the world economy, China accelerated its reform and opening-up process and became a key anchor and driver for the world economy.

Since 2002, contributing nearly 30 percent on average to global economic growth, China has been an important driver of the world economy.

China is a major trade partner of more than 120 countries and regions, and the largest export market for the LDCs.

Since 2013, China has been the world's second largest service importer, and for many years in a row the world's largest source of outbound tourists.

From 2001 to 2017, China's FDI increased from $46.88bn to $136.32bn. According to the Business Confidence Survey 2018 by the European Union Chamber of Commerce in China, more than half of its member enterprises plan to expand their presence in the Chinese market.

China is willing to provide more public goods to the international community.

Since the Belt and Road Initiative was proposed, more than 80 countries and international organisations have signed cooperation agreements with China.

From 2013 to 2017, the total value of China's trade with other Belt and Road countries exceeded $5trn, and total investment by Chinese enterprises in these countries exceeded $70bn.

By the end of 2017, Chinese enterprises had set up 75 overseas economic and trade cooperation zones in relevant countries, and created 220,000 local jobs.

Opening-up end point

Fulfilling China's WTO commitments has never been the end point of its opening-up.

China commits itself to opening up even wider and deeper, and working together with other countries to build a community of shared future with extensive converging interests and a high degree of interdependence.

In recent years, China has self-initiated significant reductions to import tariffs for multiple times.

According to the WTO, China's trade-weighted average import tariff rate had fallen to 4.4 percent in 2015, only 1.5 to 2 percentage points higher than those of developed economies such as the US and the EU.

In the meantime, China has witnessed impressive improvement in terms of trade facilitation.

The average time for customs clearance has been reduced to less than 20 hours for imports.

By March 2018, all items for non-administrative licence approval had been cancelled.

In the first half of 2018, revision of the negative list for foreign investment was completed, substantially widening market access for foreign investment in financial sector, among others.

As the world's biggest developing country, China's accession to the WTO has been a blessing not only for itself, but also for the rest of the world.

China, as it opens wider to the world among efforts to pursue high-quality growth, is bound to contribute significantly to the stability of the world economy and the wellbeing of people of all countries in the world.

Author bio

Ambassador Zhang Ming is head of mission of the People's Republic of China to the European Union.

Disclaimer

This article is sponsored by a third party. All opinions in this article reflect the views of the author and not of EUobserver.

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