WTO架构下之贸易谈判).ppt

Trade Bargaining under the WTO: An Example of US-China Trade (WTO架構下之貿易談判) Dr. Pei-Shan Kao, Assistant Professor National Chiao Tung University Centre for General Education Unit 6 I. Introduction II. US-China Trade Contacts and Exchange III. Bilateral Trade Disputes and Frictions IV. Analysis on US-China Trade Bargaining under the WTO Regime V. Conclusion Question 1: Did the WTO promote US-China trade bargaining since Chinas entry in 2001? Question 2: Have their trade frictions been resolved under the WTO regime? Question 3: Can the mechanism of the WTO facilitate effectively US- China trade bargaining hence resolves their disputes and promotes their relations? Question 4: How did the WTO change and affect Chinas trade behavior and Chinas relations with its trading partners? Source: http:/english.pravda.ru/img/2005/10/wto2.jpg, “consulted in March 2009”. US-China Trade Relations: Since they established formal diplomatic relations in 1979, they signed a trade agreement granting each other the most -favoured-nation (MFN) status. The two-way trade developed and grew rapidly. Many trade disputes and frictions occurred. Americans were unsatisfied with many problems: e.g. Chinas arbitrary administrative interference and discriminatory regulatory processes, trade barriers, and unfair and non-transparent trade practices were prevalent. The U.S.A welcomed Chinas entry into the WTO Americans and Western Countries Expectations of Chinas accession to the WTO *Opening the Chinese market to bring huge commercial benefits to them. *Reducing Chinese trade barriers in goods, services and agricultural products. *Reducing Chinas restrictions on imports and distribution. *To decrease their trade deficit with China. *To ensure the transparency of Chinas trade policy and establish a fair and stable trading environment. * To oblige China to behave according to the western-style rules of law and to expand its Open Door policy. II. US-China Trade Contacts and Exchange *According to the US-China Business Council, the bilateral trade increased from $85.5 billion in 1998 to $386.7 billion in 2007; it grew 4.5 times. Figure 1 Annual Growth Rate of US-China Bilateral Trade 1998-2008 Source: “US-China Trade Statistics and Chinas World Trade Statistics” US-China Business Council, /statistics/tradetable.html, “consulted in March 2009”. *China now is worlds third-largest economy after the United States and Japan. *China is also now worlds third-largest trading nation, following the USA and Germany. *China-US two-way trade accounted for 17.7% of Chinas total trade amount. *The United States now is Chinas largest trading partner. It is also Chinas largest export market, and its fourth-largest import supplier. *China is Americas third-largest export market and it is also Americas fastest growing export market. *China has passed Canada, becomes Americas biggest import supplier. US-China Trade Structure: Table 1: Top US Exports to China 2007 - 1. Electrical machinery and equipment 2. Power generation equipment 3. Air and spacecraft 4. Oil seeds and oleaginous fruits 5. Plastics and articles thereof 6. Optics and medical equipment 7. Iron and steel 8. Copper and articles thereof 9. Organic chemicals 10. Pulp and paperboard - Source: The US-China Business Council, /statistics/tradetable.html, “consulted in March 2009”. Source of the photos: http:/www.mrmz.ru/global/img/com_foto/f5.jpg; /image/2f0j00EvjTLdSCnfpsM/Electrical- Machinery.jpg; .uk/netregs/businesses/62245.aspx, “consulted in March 2009”. Table 2: Top US Imports from China 2007 - 1. Electrical machinery and equipment 2. Power generation equipment 3. Toys and games 4. Apparel 5. Furniture 6. Footwear and parts thereof 7. Iron and steel 8. Plastics and articles thereof 9. Leather and travel goods 10. Vehicles other than railway - Source: The US-China Business Council, /statistics/tradetable.html, “consulted in March 2009”. Source of the photos: /power-generation.php; .sg/baby-products/baby- toys/soft-toys-plush-toy-TOY004-0.jpg; /1220/1145199436_c9e7505313.jpg;http:/www.home-office- design.co.uk/acatalog/office_furniture_BOOKCASES.jpg, “consulted in March 2009”. China has gradually shifted its export structure from labour- intensive products such as textiles; shoes; and toys to capital- intensive goods. US-China trade reached a particularly high level of growth: (1)the years after 1979, when they established formal diplomatic relations (2)in the post-Cold War era. Total US-China bilateral trade increased from $17.8 billion in 1989 to over $409 billion in 2008 China has become the USAs largest deficit trading partner, China had a trade surplus with the United States of $266.3 billion in 2008. Trade Disputes and Conflicts Appeared Quarrels before China joined the WTO: Chinas MFN status, Chinese exchange rate, IPR III. Bilateral Trade Disputes and Frictions After China joined the WTO: Disputes sent to the DSB A dispute arises when one member believes another is violating an agreement or a commitment Appeal to the DSB to resolve the dispute The DSB will establish “Dispute Panels” to consider the case (The panels will make recommendation) The “Appellate Body” can amend the panels recommendation Disputes settled “out of court”, or remain in a prolonged consultation phase Table 3. US-China Trade Disputes Brought to WTO Complaint Respondent ChinaChinaChinaUSAUSA USAsteel safeguards (DS 252) anti- dumping duty on coated free sheet paper (DS 368) anti- dumping duties (DS 379) Chinapreferential VAT for IC (DS 309) auto parts (DS 340) Complaint Respondent USAUSAUSAUSAUSA ChinaTax refunds (DS 358) IPR (DS 362) Publication and audiovisual services (DS 363) financial services (DS 373) grants, loans (DS 387) IV. Analysis on US-China Trade Bargaining under the WTO Regime 1. Save the consultation and bargaining time: e.g. On the cases of Chinas preferential VAT rate for domestically produced ICs (DS 309); the measures China imposed on foreign financial information services and services suppliers (DS 373) were resolved “out-of-court” within 4 months even without establishing a panel as China agreed to amend the measures. 2. Disputes resolved without exchanging conditions as before: e.g. (before) MFN linked with human rights issues (after) Trade issues do not need to be “politicised” 3. To ensure the realisation of states commitment: WTO is a long-term and iterative game, “the shadow of the future” can be lengthened; there will be no commitment problems. e.g. on the case of US steel safeguard measures (DS 252), although America was unsatisfied with the panel report, and appealed to the Appellate Body, it eventually accepted the decision of the DSB and promised to terminate all of the relative safeguard measures. the game is repeated, if China and the United States want to play it, they will eventually choose to cooperate. Source: /images/top_logo.gif, “consulted in March 2009”. 4. Trade Policy Reviews Mechanism (TPRM): WTO helps to monitor and supervise states behaviour and trade practices: e.g. Press released by the WTO (June 2008): The United States has taken further steps to liberalise its trade regime since its previous review in 2006. 5. To provide information about others preferences and intentions; decrease states uncertainty and fears for cooperating with others: e.g. On the case of restricting foreign financial information services and service suppliers (DS 373), China released information by the WTO expressing its will to revise the measures and reached an agreement with the United States. Conclusion -Since China joined the WTO, although the WTO could not help the United States to decrease its deficits with China, it did promote US-China trad