FOCUS: China proudly marks 5th anniversary of WTO entry

BEIJING, Dec. 10 Kyodo

Open markets, reduced customs duties and an increasingly transparent legal system show China is fulfilling its obligations undertaken when it joined the World Trade Organization on Dec. 11, 2001, according to Chinese officials.

And as the country prepares to celebrate the fifth anniversary of joining the world trade body, many foreign leaders, officials and businesspeople broadly agree with them. Pascal Lamy, the WTO's director general, recently gave China an ''A+'' for its first five years.

''China has strictly carried out the obligations it ought to carry out according to its WTO undertakings,'' said Zhang Hanlin, president of the China Institute for WTO Studies. He said China deserves 95 marks out of 100 for its efforts.

Zhang pointed out that during the last five years customs duties on foreign imports had on average fallen from 15.3 percent to 9.9 percent. China says there are now only a few products on which import tariffs need to be reduced to meet WTO guidelines.

In addition, Zhang said China has opened up its markets to foreign competition and expanded the number of areas in which overseas firms can invest. ''You can now see from the new foreign investment guide there are very, very few limited and forbidden areas,'' he said.

China is also doing its best to tackle intellectual property violations, said Zhang, despite complaints from Europe, Japan and the United States that it is not doing enough.

Both European and U.S. trade representatives recently complained to China about the issue, saying everything from aircraft parts to patented medicines are being copied by Chinese firms.

''The problem they point out does exist, but I don't think it's as serious as some Western media organizations say. I also think there's a long-standing misunderstanding about China on this point,'' said Zhang.

Economic indicators also suggest China has a lot to be cheerful about as it celebrates the fifth anniversary of its WTO entry.

At a recent international trade and investment conference in southern China's Fujian Province, Lamy said the benefit to China from joining the WTO can be seen from the ease in which its exports are now sent all over the world, a Chinese government report said.

According to the WTO, China's exports in 2000 were worth $249.2 billion and it was the world's seventh leading exporter. Currently, China is ranked third in terms of exports, which were worth $779.2 billion in the first 10 months of this year, China Customs said.

Foreign leaders say China's entry into the WTO has also benefited their countries. In a visit to China last month, European Union Trade Commissioner Peter Mandelson said bringing China into the world trading system meant ''cheaper goods in European shops.'' It is the same story all over the world.

Although he complained China needs to open up further, Mandelson said China is already far ahead of almost all other emerging economies in opening its markets to trade.

Teresa Woodland, from U.S. trade organization AmCham-China, has a similar opinion. ''Overall, WTO entry has been a huge success for the Chinese economy and I believe China has fulfilled most of its regulatory commitments.''

But even Chinese officials agree there are problems that need solving.

Woodland, who is on AmCham-China's board of governors, said one of those is making sure local governments follow central government directives.

AmCham-China recently discovered in a survey that although 42 percent of companies were happy with the central government, only 17 percent could say the same about local officials.

''There is a huge gap between what people think the central government is committed to and the situation on the ground. There are many companies moving into second-tier cities and they are running into a number of challenges,'' she said.

Violations of intellectual property rights is a good example, said Woodland. Although Beijing says it is committed to protecting such rights, officials, police officers and judges at local levels do not always enforce regulations.

China also currently faces more allegations of dumping -- selling goods at below cost to gain market share -- than any other country in the WTO, which aims to resolve such disputes between member countries as well as help develop global trade agreements.

Anti-dumping inquiries about China accounted for 32 of the 87 new cases during the first six months of this year, compared with 23 out of 105 during the corresponding period of 2005, according to the WTO.

The so-called ''bra wars'' that erupted last year when the European Union adopted quotas on China-made textiles are just one example of the trade friction that has resulted from China's burgeoning exports.

The liberalization of markets also needs to be continued, according to many involved in global trade.

''There needs to be continued confidence to open up,'' said Woodland. ''This five-year anniversary should not mark the end of the journey. This needs to continue.''