China to work along triple lines for advancing cooperation with world trade

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Last updated at: (Beijing Time) Thursday, November 20, 2003

China to work along triple lines for advancing cooperation with world trade

China, after joining the WTO, is actively engaging itself into regional economic and trade cooperation while vigorously playing a part in multilateral trade system.

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China signed in November 2002 a landmark framework agreement on comprehensive economic cooperation with the Association of Southeast Asian Nations (ASEAN), which started the construction of the China-ASEAN free trade area, the biggest of its kind in the world, which will be completed by 2010. Not long ago the Chinese central government signed the Closer Economic Partnership Arrangement (CEPA) with Hong Kong SAR and Macao SAR respectively. It indicates that China, after joining the WTO, is actively engaging itself into regional economic and trade cooperation while vigorously playing a part in multilateral trade system.

An analysis on the integration process of world economy in the past decade shows two tendencies. One is the WTO-represented multilateral trade liberalization and economic globalization and the other the integration of regional economies. By now the world has seen more than 250 regional trade schemes come into effect, of which more than 80 percent were developed during the last decade.

Not long after China's accession into the WTO, most of the Chinese people thought that the WTO membership would grant the member country a competitive ground equal to those of the other 140-odd members. However, experts and officials studying the WTO have got a clear picture that the existence of 250-strong regional trade schemes, which is still increasing fast in number, poses a great threat to the most-favored-nation status China enjoys in the WTO.

Regional trade scheme, as learned, is an important means for members within the region to help each other and develop side by side. When bringing more benefits to insiders, however, it would also repel outsiders and may harm the trade interests of other countries. Whoever joins such a scheme will enjoy benefits, or otherwise losses may be waiting for him. A ready example is Mexico, whose trade volume increased by 2.46 times five years after its joining into the North America Free Trade Agreement (NAFTA), replacing Japan to become the second biggest exporter to the US and replacing China to become the biggest textile exporter to the US.

Under such circumstances Chinese assistant minister of commerce Yi Xiaozhun made it clear that China may have its trade suffer should it stay on the WTO accession.

Although regional trade schemes in Asia lag behind the world, yet a fast movement emerged in recent years. In 2001, Premier Zhu Rongji advocated in Brunei a China-ASEAN free trade zone, which activated the process of Asia economic integration.

When attending a forum under the scheme of "China-ASEAN free trade zone and the development of Guangxi", Yi Xiaozhun revealed that China will work along triple lines in promoting its economic and trade cooperation with the world. While advancing multilateral trade cooperation, efforts will also be made in pushing forward regional free trade cooperation and bilateral free trade cooperation. Chinese officials will try to map out a package strategy of the "triple lines" as early as possible.

China's future participation in regional economic integration will be based on East Asia, according to Yi. In this region free trade areas like "10+1" (ASEAN and China), "10+3" (ASEAN and China, Japan, ROK) and "Japan-ROK" free trade areas are currently all under construction. The next step is to push forward the free trade process among China, Japan and ROK, which, as shown by a tripartite study group, would bring win-win situations and raise GDP of the three countries by 2 to 3 percent respectively. If it is completed the "10+3" scheme will naturally come into being.

Many world countries are willing to establish free trade relations with China. China will talk particularly with those who are politically friendly, complementary in industrial structure with China and with comparatively huge market capacity, such as India and Pakistan of Asia, the six countries in West Asia, South Africa of Africa, Chile of South America, Australia, New Zealand of Oceania and so on.

(By PD Online staff member Li Heng)

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