By  on January 2, 2007

GENEVA — Major Western trading powers, led by the U.S. and the European Union, are expected to intensify pressure on China this year to further open its lucrative market as part of the troubled Doha global trade talks, senior trade diplomats and experts said.

With its foreign reserves piling up and now in excess of $1 trillion, China is also likely to come under sustained pressure to expedite efforts toward a more flexible policy for its currency, the yuan, and to take effective steps to combat widespread abuse of intellectual property rights and turn off the flow of subsidies to state-owned enterprises.

Five years after China joined the World Trade Organization, the perception in trade circles is that the honeymoon is over and that the country, as the world's third-largest trading power, needs to play a more active role in shoring up the system.

China's low posture "is affecting the talks," said a WTO ambassador from a G8 power who spoke on the condition of anonymity. A similar sentiment was expressed by a number of top Asian WTO envoys, who also requested anonymity.

The global trade talks, launched in Doha, Qatar, in November 2001, were suspended in late July after major rich and emerging trading powers — the U.S., EU, Japan, Australia, Brazil and India — could not narrow their differences on how to proceed to lower subsidies and tariffs in agricultural trade.

"China, a big elephant in the room, has been very quiet [in Doha], but it has [the] most to gain," said Christopher Wenk, director of international trade policy at the U.S.-based National Association of Manufacturers. "They have to play a more active role in these negotiations. They are the big beneficiaries."

Senior Chinese officials consider as unfair the "free-rider" charges and counter that they are firm supporters of the multilateral system and are making "tremendous efforts." A few WTO envoys have even gone so far as to put some of the blame for the collapse of the talks in July on the lack of leadership by China.

Anthony Hill, a Geneva-based trade consultant, said China's WTO membership has changed the dynamics of the agency, which oversees most global trade in goods and services.

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