China and the WTO

An analysis of the benefits of China’s accession to the WTO.

The paper discusses how by opening the Chinese economy to U.S. goods, services and agricultural products, the WTO accession will create significant new opportunities for American businesses, farmers and working people, and it will help to reform and improve a deeply imbalanced existing trade relationship. The paper also argues that WTO accession will create new economic freedoms for Chinese citizens and promote the rule of law in many fields now dominated by state power and control. The paper also notes that the WTO accession has potential beyond economics and trade, as a means to advance the rule of law in China, and as a precedent for willingness to accept international standards of behavior in other fields.
The World Trade Organization came after the General Agreement on Trade and Tariffs, or GATT. Its creation in 1948 reflected the personal experience of President Truman and his European counterparts in Depression and War. They had seen the Smoot-Hawley Act in America and similar protectionist policies overseas deepen the Depression and contribute to the political upheavals of the 1930s. Fifteen years later, they believed that by reopening world markets they could promote growth and raise living standards; and that, in tandem with a strong and confident security policy, as open markets gave nations greater stakes in stability and prosperity beyond their borders, a fragile peace would strengthen.
With the Communist revolution, China set out upon a very different road. After 1949, it shut doors it had once opened to the world. Among its new leaders’ first steps were to expel foreign businesses from China and bar direct economic contact between Chinese citizens and the outside world. Inside China were similar policies: destruction of private internal trading networks linking Chinese cities and villages, abolition of private property and land ownership, and of course suppression of the right to object to these policies. [3]”