China Must Move Beyond WTO Commitments to Open Markets, says USCBC

Washington, DC, September 27, 2007 - In testimony before the US government today on China's compliance with its World Trade Organization (WTO) commitments, the US-China Business Council (USCBC) stated that "USCBC member companies consistently say that China's WTO entry has been vital to their success in China."

The full testimony is online at
http://www.uschina.org/public/documents/2007/09/uscbc-china-wto-implementation-testimony.pdf.

USCBC reviewed the WTO commitments that were due over the past year and the progress China has made over the five years since the country joined the WTO in 2001. Despite China's positive steps to open its market, the organization stressed that China has not fully met its obligations in a number of areas. Restrictions in retail and wholesale distribution services, electronic payment services, engineering design, express delivery and courier services, and telecom—all of which present problems to USCBC member companies—were highlighted in the testimony.

As China reaches the end of its WTO-mandated "roadmap" of commitments, USCBC commented, "Many of the hurdles US companies must [now] overcome result from China's falling short of full adherence to the general principles of the WTO, as opposed to specific commitments." Examples include China's inadequate protection of intellectual property rights, its insufficiently transparent legal and regulatory processes, and its opaque development of technical and product standards that may favor local PRC companies over foreign competitors.

The group also cited concerns about the future direction of China's trade and investment policies. "There is an active debate in China right now about the role of foreign companies in the economy. Many voices are sounding a more nationalistic tone and advocating limitations and restrictions on foreign participation in certain sectors." USCBC's testimony urges the US government to raise these concerns with the PRC government in its bilateral dialogues this fall.

USCBC testified before the Trade Policy Staff Committee, an interagency group coordinated by the Office of the US Trade Representative (USTR). USTR holds the hearing in preparation for its annual December submission to Congress of a report on China's WTO compliance. Since the hearing was established, USCBC has testified annually—using information gathered through an annual survey of member companies and through direct communication with company representatives—to highlight the problems and successes of its member companies.

The US-China Business Council (USCBC, www.uschina.org) is the leading organization of US companies engaged in business with the People's Republic of China. Founded in 1973, the USCBC provides extensive China-focused information, advisory, and advocacy services, along with events, to more than 250 US corporations operating within the United States and throughout Asia.