China's WTO Membership Has a Ways to Go

March 21, 2000

A General Accounting Office report details the steps yet to be taken before China becomes a member of the World Trade Organization and the U.S.-China trade agreement becomes a fact. It could take several more months to conclude all the negotiations necessary for China's WTO accession.

Even the U.S.-China trade agreement negotiations are not complete, GAO pointed out. "While the President announced a bilateral agreement covering market access issues with China in November 1999, some U.S. negotiating objectives have yet to be achieved, and many of those tentatively achieved must still be finalized in a WTO agreement that outlines the terms of China'smembership."

GAO also noted that China yet must complete multilateral negotiations with other WTO members, the European Union in particular. "Then, all participants must complete several important tasks, including verifying the text of the agreement, before the approval and implementation phases of (China's) accession process can begin. It could take several months after all these negotiations conclude before China can become a WTO member."

If and when Congress decides to enact permanent normal trade relations legislation for China, it could do so in one of two ways, based on previous congressional action, said GAO. Congress provided PNTR directly to Estonia, Latvia and Lithuania in 1991, but this was before any of those countries became WTO members.

Several congressional bills have proposed a slightly different variation of this approach for China, GAO noted. These bills provide that on the date China becomes a WTO members, title IV of the Trade Act of 1974 no longer will apply, and China's products will receive normal trade relations status.

"Under the second approach, Congress could authorize the President to make the permanent normal trade relations determination. Congress has used this approach more often," said GAO. The President was authorized to make this determination in 1996 for Bulgaria which was not yet a WTO member and most recently for Mongolia in 1999.

Congress also could impose conditions on the President as part of granting this authority -- "for example, Congress could require that the President make a positive finding that certain concerns about particular Chinese trade practices have been addressed before he grants permanent normal trade relations," said GAO.

The report is available by clicking here .