VI-2 Question: The post-WTO transition period for China expired in the end of 2006. In the past five years, how have the industries in China met the challenges of WTO entry?
A: December 11, 2006 marked the fifth anniversary of China's WTO accession. As a responsible large country, China has honored the pledges it made when applying for WTO membership. China has adjusted its foreign trade policy and further opened its markets.
In the area of commodity trade, on July 1, 2004, China eliminated the system of examination and approval of trading rights, a system that had been in place for half a century. From that day on, all enterprises have enjoyed full trading rights, a half-year ahead of the original schedule established in the WTO accession agreement. On January 1, 2005, China removed all non-tariff barriers such as import quotas and licensing according to the promised schedule. So far, the average import tariff on industrial products has decreased to 9 percent from the pre-WTO level of 14.8 percent, a 39.2 percent decrease, whereas the average import tariff on agricultural products has dropped to 15.2 percent from the pre-WTO level of 23.2 percent, a drop of 34.5 percent. The tariff for agricultural products is much lower than the world average of 62 percent.
In the area of service trade, China has opened 104 of the 160 service sectors on the list required by the WTO. As a reference, developed countries on average have 108 service sectors open to world trade. China has honored its WTO commitments by giving foreign companies market access to key service sectors such as banking, insurance, telecommunications, retail distribution, accounting and education.
In the area of intellectual property rights (IPRs), China has fully complied with WTO agreements by overhauling its legislation regarding IPRs. China has revised the Patent Law, the Trademark Law and the Copyright Law. China will strengthen implementation of these laws, and has taken many nationwide initiatives in protecting IPRs.
In addition, in the Doha round of WTO negotiation, China actively participated in crafting multilateral rules. During the Doha round, on behalf of developing countries, China submitted 67 written suggestions or position papers on agricultural or non-agricultural service trade. China had successfully hosted two WTO ministerial level meetings, and China acted as a responsible key player in promoting consensus among participants.
China's efforts to comply with its WTO commitments in the past five years have been acknowledged by most of the WTO members. In April 2006, the WTO conducted its first review of the post-WTO trade policies of China. During the two-day review session, China successfully answered the questions of other WTO members, who commended China's economic reform policies.