Foreign banks are now prohibited from doing business in RMB with Chinese customers (only a few can do business in RMB with foreign customers in RMB). China imposes severe geographical restrictions on the opening of foreign banks.
China has pledged to give U.S. banks full market access within five years.
Two years after access, foreign banks will be able to conduct RMB business with Chinese companies.
Five years after access, foreign banks will be able to conduct RMB business with Chinese residents.
During the five-year period, both geographic and customer restrictions will be lifted.
After access non-financial sector finance companies will be able to provide auto financing.
China will allow minority, foreign-owned joint ventures to participate in fund management on the same terms as Chinese companies. As Chinese firms expand their operations, foreign bond joint ventures will be able to enjoy the same expansion. Minority joint ventures will be allowed to underwrite domestic securities and to underwrite and trade in foreign-currency-denominated securities (bonds and universal shares).
PROFESSIONAL SERVICES
On the professional services front, China now severely restricts the operations of outside legal and accounting firms in the country.
China is offering a wide range of commitments in the agreement, covering legal, accounting, tax, management consulting, architecture, engineering, urban planning, medical and dental, and computer-related services. China will allow foreign professionals to enter the Chinese market under a highly transparent process.
Audio-visual
China's commitments also include the right to distribute ownership rights to operate videocassette recorders, tape recorders and cameras. In the case of videocassette recorders and tape recorders, China will allow foreign countries to take a forty-nine percent stake in joint ventures engaged in these distributions. China has also agreed to import forty films after access and gradually increase the number to fifty within three years, twenty of which will be under benefit sharing.
Tourism
Hotels - China will allow unrestricted access to the Chinese market for three years to operators capable of building 100 percent foreign-owned hotels, with majority ownership allowed after access.
Terms of Agreement
China's WTO agreements and the commitments of the Working Party Report establish enforceable rights and obligations through the WTO dispute settlement process. We reached agreement on important provisions relating to anti-dumping and subsidies, protective measures against import surges, technology transfer conditions and compensation, and practices for state-owned and state-invested enterprises. These regulations are of particular importance to American workers and business.
China agreed to implement the TRIMs agreement upon accession to the WTO by eliminating and suspending the application of trade and foreign exchange balancing provisions, eliminating and suspending the application of local satisfaction provisions, and suspending the enforcement of contracts imposing such provisions; and to enact or enforce laws or other provisions relating to the transfer of scientific, technological, or other knowledge only to the extent that they are consistent with the WTO agreements relating to protection of intellectual property rights and to trade and investment.
These provisions are consistent with the WTO agreements on the protection of intellectual property rights and on trade and investment.
These provisions will also help protect U.S. companies from being forced to transfer technology, as China has also agreed that, once it joins, it will not use any kind of performance requirements - including local satisfaction requirements, compensation, technology transfer, or requirements to conduct research and development in China - as a basis for approving investments, import licenses, or other measures. -as a condition for approval of investment, import licenses or any other import approval process.
Anti-Dumping and Subsidies Methods
The terms of the agreement have been agreed to provide for strong protection of U.S. companies and workers against unfair trade practices, including dumping and subsidies. The U.S. and China agreed that the U.S. side can maintain its current anti-dumping methods (treating China as a non-market economy) in future anti-dumping cases without legal challenge.
This provision remains in effect for 15 years after China's entry into the WTO.
In addition, when the U.S. adopts offsetting duty drawback laws against China, it can take into account the special characteristics of the Chinese economy if it finds that any subsidized preferences may exist.
Special product protections
The agreed-upon provisions also provide for strong protections for domestic U.S. companies and workers against rapidly growing imports.
To that end, the "product-specific protections" provision would serve as a special mechanism to adjust for surges in imports that cause, or have the potential to cause, market disruptions in a U.S. industry.
China is a large exporter and enjoys free access to the U.S. market. This mechanism, along with other WTO protections, differs from traditional protections. This provision allows the U.S. to adjust imports that come only from China, rather than from the entire world. In addition, the U.S. can impose unilateral restrictions based on legal standards that are lower than those of the WTO Security Agreement. This provision will remain in effect for 12 years after China's entry into the WTO.
State-owned and state-invested enterprises
The agreement emphasizes important issues related to the Chinese government's economic investments. China agrees to ensure that state-owned and state-invested enterprises will make purchases and sales based solely on commercial considerations (e.g., price, quality, and competitiveness in the marketplace), so that U.S. firms will have the opportunity to compete in sales and purchases without discrimination.
China also agrees that it will not influence (directly or indirectly) the commercial decisions of these enterprises, except in a manner consistent with WTO regulations. In order to respect WTO regulations on state-owned and state-invested enterprises, these enterprises must comply with WTO disciplines.
-The procurement of goods and services by these enterprises does not constitute "government procurement" and must therefore comply with WTO regulations.
-Clarify the status of these enterprises under the WTO Agreement on Subsidies and Compensatory Measures. This will help ensure that we effectively apply our trade regulations to these businesses when it is appropriate for them to do so.
Textiles
China's proposal would include provisions in the 1997 bilateral agreement on textiles, which allows U.S. companies and workers to respond to increased imports of textiles and clothing. Such self-defense measures on textiles would remain in place until Dec. 31, 2008, after the expiration of the WTO Agreement on Textiles and Clothing.
Four, WTO accession on China's related industries, fields.
The impact of WTO accession on China's related industries.
Accession to the World Trade Organization in general and in the long run, is beneficial to China, but also for the development of China's economy in the 21st century to lay a more stable foundation.
GDP increased by 200 billion yuan.
First of all, after China's accession to the WTO, it will no longer have to be embarrassed by the United States once a year on most-favored-nation (MFN) status, and China can also enjoy multilateral and permanent MFN status.
Secondly, China's accession to the World Trade Organization is conducive to China's participation in international competition on equal terms is conducive to the development of China's market economy, the realization of the rational allocation of resources. After China's accession to the WTO, the prices of some durable consumer goods and services will be further reduced, bringing benefits to the majority of consumers. After China's accession to the WTO, the investment environment will become better. Foreign investors can enjoy national treatment, which is conducive to the introduction of foreign investment.
According to the estimation of relevant experts, China's accession to the WTO increases China's GDP by 2.94%. This means that China will increase the output value of more than 200 billion yuan and employment of several million people.
According to the estimation of the State Planning Commission, during the seven years from 1999 to 2005, China's imports of all kinds of equipment, technology and products will total up to 1.5 trillion U.S. dollars. After reducing tariffs, the cost of imported equipment, technology and products will be reduced.
Textile share increased by 10%
Participation in the World Trade Organization will enable the major trading powers to abolish different degrees of trade discrimination measures imposed on China. At present, major trading powers use the excuse that China is not a member of the World Trade Organization and cannot enjoy the treatment of World Trade Organization members to impose restrictions on Chinese exports.
For example, textile importing developed countries, has begun in 1995 to implement the gradual abolition of textile import quota agreement, but China has been increasing textile quota restrictions, and require China to continue to sign a quota agreement, reducing China's textile exports. After joining the World Trade Organization, the discriminatory quotas of the United States and other developed countries restricting China's textile exports will be eliminated due to the World Trade Organization's stipulation of the phased elimination of quotas on textiles by 2005. Textiles, garments and shoes and hats are China's traditional export commodities, accounting for about 20% of China's total foreign exports, and China's textile and garment industries will be provided with a stabilized trade environment that will benefit textile and garment producers. It is estimated that by the post-2005 period, China's textile exports will gain a 10% higher market share than at present. Exports of textiles, clothing and footwear are expected to increase by more than 5 billion dollars.
In addition to the textile and clothing industry, accession to the World Trade Organization, some of China's chemical products and some iron and steel products are also beneficial. It is also beneficial to color TVs, washing machines, electric fans, bicycles, toys, manufacturing, stationery, food canning industry and some electromechanical products, which are already large-scale and technologically mature.
China's auto industry will face the biggest impact
After joining the WTO, it will face the huge pressure of a large influx of foreign cars. 1998 China **** production of 1.62 million cars, an increase of only 32% over 1997, of which 500,000 sedans, only 5.21% more than the 1997 production.
Currently, the import tax on automobiles is 80-100%, after joining the WTO, it will be reduced to 25% by 2005, and the average tariff on the import of automobile parts will be reduced to 10% and the quota on the import of automobiles will be canceled. This will increase the competition between foreign automobile enterprises and auto parts enterprises and Chinese enterprises in the domestic market. As the international market sedan price is only 1 / 3 to 1 / 4 of the domestic car, even with 25% of the import tax, the price is much lower than the domestic car, and the quality, style and safety have many advantages, therefore, can be expected to join the WTO, the formation of China's sedan industry, the biggest impact.
High-tech foreign companies tend to relax the environment
High-tech industry is China's fastest-growing industry, the next 15 years, the annual growth rate of 20-40%. After China's accession to the WTO, will implement the international information technology agreement, that is, to realize the principle of zero tariffs on technology products promoted by the United States, China's tariffs on information industry products will be reduced from the current average of 13.3% to zero, China will no longer be on the semiconductor computers, computer products, telecommunication equipment, and other information technology products to impose tariffs in 2005. In addition to zero tariffs, the practice of foreign high-tech enterprises having to transfer technology and export quotas to China in order to gain domestic market share will be canceled, making the environment for high-tech foreign-invested enterprises more relaxed and their technological advantages strengthened, which will also enable companies from developed countries such as the United States to gain a larger share of domestic market sales.
The telecommunications market will be further liberalized. In the telecommunications sector, China will allow foreign investment to take a 49 percent stake in all telecommunications services and a 51 percent stake in value-added and paging services, in addition to agreeing to adopt the symbol-segmented multiple transmission method (CDMA) developed by U.S. firms as the next-generation way to carry telephones. At present, China's telephone charges are seven times those of the United States, and the quality of service has improved very slowly due to monopoly operation, with a large gap between it and the international level, and consumers' opinions are also large. After joining the WTO, China's telecommunications market will shift from monopoly to fierce competition, pushing China's telecommunications industry to improve technology and service quality and lower prices.
Continued