China Completes 10 years at WTO
Excerpts from Lamy’s Speech
China’s growth miracle did not start in December 2001. It predates its entry into the WTO. But joining the WTO was a means to anchor reforms and pursue the transformation. WTO membership has served as a stabilizer and accelerator in China’s economic take-off.
China’s accession to the WTO proved decisive in several respects.
The goal to become a WTO member acted as a lever for the process of domestic modernisation.
It generated trust by foreign investors who have been key actors in China’s take-off through Foreign Direct Investment and transfer of technology.
WTO membership also underpinned Chinese export-led growth with a strong insurance policy against protectionism.
Accession to the WTO strengthened China and helped lay down a more solid basis for China’s future development.
But as China develops, it also has to wrestle with tremendous challenges, such as regional and income distribution imbalances, the need for stronger social safety nets, environmental degradation and an ageing population. It is also working to achieve more balance between external and domestic demand, to foster a friendlier business environment and a better protection of intellectual property.
The WTO risks crumbling under the weight of excessive expectations, especially in areas where its role is only modest, such as in addressing global macro-economic imbalances or currency fluctuations. The lesson learnt from the recent global economic crisis is that the WTO has a significant role to play as a bulwark against protectionism. This is particularly true of China which would have been much more severely affected by protectionist measures, given its prominence in world trade. The WTO has so far protected China against high intensity protectionism during the crisis.
Today, the Chinese economy and its influence are greater and stronger than ten years ago. As a global power, it is only natural that the expectations of other countries on China have also grown. China’s participation and support are vital in any collective action to address global challenges. With today’s economic difficulties across the world, resolve and leadership are in desperate need. We all need a proactive China.
I was particularly encouraged by President Hu’s announcement at the Cannes G-20 Summit that China will provide duty and quota free market access to 97% of exports from the world’s poorest countries. This is a good example of leadership and shows that China is willing to share its growing prosperity with other countries and to take on more global responsibility as it grows.
On this tenth anniversary, and as we look forward for the next decade, I have two wishes that I would like to express.
The first is that China’s involvement in the WTO helps us all in keeping this organization on the move towards more open and fairer trade.
The second is that the WTO’s relevance for China keeps growing and helps this country to address its reform challenges.
China has been and should remain important for the WTO. The WTO has been and should remain important for China.