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China: Plurilateral discussions to iron out last-minute problems

by Chakravarthi Raghavan

Geneva, 11 Sep 2001 - Plurilateral discussions in three or four separate groups, within the Working Party on China’s accession to the WTO, were being held Wednesday to iron out some last-minute problems that appear to have cropped up.

The Working Party, according to the programme, was due to consider, adopt and forward to the next Ministerial meeting its report on the China accession and the annexed protocol.

Trade diplomats said that a number of details and issues remain to be sorted out.

These apparently involve:

        the question of tariff-rate quotas in several agricultural products, and the bilateral accords reached by China with some of the members relating to in-quota and other tariffs to be applied,

        the issues relating to the American Insurance Company - and the attempt of the Company and the United States to ‘grand-father’ its existing rights to conduct life insurance operations on a wholly-owned basis (rather than the 50-50 joint venture basis in China’s GATS schedule),

        questions relating to reinsurance and how the commitments of China on these reached in the bilateral accords (principally with the US, EU and a few others) are to be shown in its schedule,

        questions relating to the audio-visual services,

        the schedules of China’s commitments in market access in goods, putting together its various bilateral accords and some variations and contradictions that have come up, and

        the trade policy review of China and its implementation (over a period) of its accession commitments.

Developing-country diplomats said that no serious problems were expected, but that these issues had to be sorted out, particularly as they see it with the United States and the EU posturing at the last moment to extract as much more concessions as they could.

The chairman of the Working Party also made clear that having come this distance, he would ‘stop the clock’ to ensure that as originally scheduled, the report and annexed protocol and other particulars were adopted on 13 September.

[In a note released later by the WTO, the Chairman of the Working Party has announced a revised schedule of meetings, with an informal meeting of the Working Party taking place on 14th September and a formal meeting of the Working Party to take place on 17th September.]

Third World diplomats said that as far as they knew, the talks between China and Mexico have not so far been concluded successfully. However, Mexico has said it would not hold up approval of the China Working Party report, but that it would apply the non-exclusion clause to China (in so far as rights and obligations at the WTO vis-a-vis Mexico), enabling negotiations to continue even after China’s entry into the WTO.

In respect of tariff-rate quotas and other arrangements in some products, and the rates to be applied, the problem appears to be related to the bilateral accords reached by China such as in vegetable oil, and soya where there is apparently some variations that have come out in scrutinising its schedules.

Also, in negotiating some bilateral accords, as with the Dominican Republic and Honduras, China would appear to have agreed to a zero tariff on some items, while in some other cases, the rates are higher. Under the most-favoured-nation principle, the conflict and variation would need to be resolved, and China would appear to be trying to persuade the Dominican Republic and Honduras to agree to some changes. It is not clear whether they would agree, in return for something else, or would want to have China, after accession, seek to have Art. XXVIII consultations and negotiations for change of tariffs schedules, where their negotiations would be on the basis of acquired rights.

According to trade diplomats in the informal Working Party meeting Tuesday, the US and EC attempted to get some changes, by the simple expedient of putting formulations in separate paragraphs in an area of negotiations (which everyone thought had been settled) where the Chinese concessions were clearly qualified and made clear and applied only to China.

However, the Chairman of the Working Party made clear that he would not agree to reopen the issue. – SUNS4965

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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