by Freeman MENG
China accession to the World Trade Organization (WTO) would affect the fundamental economic interests of both the United States and China. American opportunities to export to and invest in China would increase significantly. The United States would continue to apply the same, normal tariffs it has applied to imports from China continuously since 1980, but on a permanent basis instead of through annual renewals. China would ultimately be freed from quota restrictions under the Multi-Fiber Arrangement, which is being phased out as part of the WTO Agreement on Clothing and Textiles, enabling China to compete freely in the US market with other textile and apparel producers. The United States would agree to resolve trade disputes with China multilaterally as it does with the other 131 WTO members, rather than bilaterally.
The purpose of this balance sheet is to provide answers to six economic questions at the heart of the WTO accession debate in the United States:
· What would be the impact of China抯 WTO accession on US exports?
· What would be the impact of China抯 WTO accession on US imports?
· Are China抯 proposed terms of accession a good deal for the United States?
· Will the United States see its leverage to compel Chinese reforms diminish once WTO membership is granted?
· Will China abide by its WTO commitments and obligations?
· If the deal is so good for the United States, why is China willing to accept it?
These six questions reflect the economic aspects of the debate over China抯 accession to the WTO. In addition, of course, accession entails sensitive political questions for both China and the United States. Further, some raise the basic issue of whether a growing China is good for the United States梚ncluding in security terms. These issues are not addressed in this Policy Brief. Our answers to the economic questions, however, strongly support the case for Chinese accession to the WTO from the perspective of both US and Chinese national interests.
China in the WTO and US Exports
US Imports and the US-China Trade Deficit
Report Card
Losing Leverage Or Gaining It?
Is WTO Just Scrap of Paper?
Is Growth Strategy Destiny?
Conclusion
