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In 2003, the United States exported to China nearly
$740 million in cotton and $2.9 billion in soybeans.
Since 2001:
- 10% ↓ U.S. exports to China
- 66% ↑ U.S. exports to China
U.S. exports to China ↑ 36% (January–June 2004
vs. January– June 2003)
China joins the WTO in 2001.
China has reformed 1,100 laws to come into WTO compliance.
Positively affected sectors:
- beef
- fruit
- fish
- cotton
- wheat
- heavy equipment
- paper
- steel
- chemicals
- medical equipment
- autos
- motorcycles
- transportation equipment
Much still has to be done.
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China’s entry into the World Trade Organization
(WTO) has given U.S. farmers, manufacturers and
service providers access to a large and growing
market, result-ing in the rapid growth of U.S.
exports to China.
- China’s entry into the WTO required it to
reduce tariffs and other barriers to U.S. exports
without requiring the United States to reduce
any tariff.
- Since acceding to the WTO in 2001, China has
become the United States’ third largest trading
partner behind Canada and Mexico. An important
component of that increased trade is U.S. exports.
While U.S. exports to the rest of the world
have declined by 10 percent since 2001, U.S.
exports to China have grown by 66 percent.
- Reduction of Chinese restrictions on imports
of agricultural goods facilitated U.S. exports
to China of nearly $740 million in cotton and
$2.9 billion in soybeans in 2003.
- Removal of import quotas for American-made
automobiles and motor-cycles has given U.S.
producers access to one of the world’s largest
and fastest growing markets for those products.
- Among the top U.S. exports to China in the
first half of 2004 were integrated circuits,
cotton and airplanes.
- Removal of discriminatory regulations on express
delivery services allows U.S. providers equal
access to the Chinese market. Reduction in capital
requirements for financial service providers
opens the lucrative auto-financing sector to
U.S. companies.Firms that participate in a global
economy grow faster and pay more than those
that do not.
Entry into the WTO binds China to a rules-based
trading system.
- As a result of China’s accession to the WTO,
the United States can use formal legal procedures
to force China to comply with WTO trade rules.
- China has taken many steps to bring its laws
and regulations into compliance with WTO rules.
It has repealed or reformed more than 1,100
laws and regulations, reduced tariffs, and removed
nontariff trade barriers.
- In 2004, the United States filed its first
WTO case against China on tax policies that
discriminated against U.S. exports of semiconductors.
The case resulted in a settlement agreement
that ended the discriminatory practice and helped
level the playing field for U.S. semiconductor
producers.
- The United States also has succeeded in using
WTO consultation mechanisms to resolve disputes
over China’s use of quotas on agricul-tural
commodities that are important to U.S. farmers,
such as cotton, wheat and fertilizers.
- As part of its accession to the WTO, China
has agreed to improve protection for intellectual
property and work to stop piracy and counterfeiting
of American ideas and innovations.
- China is participating in the WTO Information
Technology Agreement, which requires it to eliminate
tariffs on computers, semiconductors and other
information-technology products. China already
has made significant cuts in these tariffs and
has agreed to eliminate all tariffs on goods
covered by the agreement by 2005.
- In 2003, one year ahead of schedule, China
agreed to implement WTO obligations allowing
U.S. companies to ship U.S. products to China
without using local middlemen.
U.S. Department of Commerce, Office of the
United States Trade Representative, 2004
Report to Congress on China’s WTO Compliance.
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China’s efforts to implement its World Trade Organization
(WTO) obligations have significantly improved market
access for U.S. products and improved the transparency
of its laws and regulations.
- China has implemented its tariff reduction obligations
for industrial and agricultural goods, resulting in
increased market access for U.S. producers.
- Tariff reductions on beef, fresh fruit and fresh
fish, among other agricul-tural products, have resulted
in significant increases in U.S. exports to China
since 2001. U.S. cotton and wheat exports have increased
dramatically. In the first half of 2004, exports of
cotton to China were 300 percent greater than they
were in the first half of 2002; wheat exports grew
by 2,000 percent in the same period.
- Tariff reductions on a number of manufacturing sectors,
including agricultural and construction equipment,
paper products, steel, chemi-cals, and medical and
scientific equipment, have helped produce rapid growth
in U.S. exports to China. Exports of medical and optical
equip-ment, for example, grew by 32 percent in 2003.
- In 2003, China effectively ended the quota system
for certain U.S. automobile companies, one year ahead
of the 2004 deadline in the WTO agreement. Quotas
on motorcycles and crane lorries and chassis also
were eliminated a year ahead of schedule in 2003.
These measures give U.S. producers greatly improved
access to the growing Chinese markets for construction
equipment and transportation equipment.
- China has made significant reforms to its antidumping,
countervailing duty and safeguard laws to comply with
the WTO agreements. These reforms provide additional
protections of transparency and judicial review to
U.S. companies when they are investigated under China’s
trade remedy laws.
- China has eliminated export restrictions and fees
on most goods, eliminating price distortions and ensuring
that U.S. businesses and consumers have access to
goods from China.
- China has reformed its laws and regulations to conform
to the require-ments of the Agreement on Trade Related
Aspects of Intellectual Property, but enforcement
problems continue to plague China’s intellec-tual
property rights protection. China acknowledges that
it has a prob-lem and has created a “leading group”
within the government to improve intellectual property
rights protection enforcement.
- U.S. officials must continue to press China to conform
to WTO rules and to implement its WTO accession obligations
in a timely manner.
- China maintains restrictions on the export of certain
critical raw materials, such as florspar. These continued
export restrictions on raw materials deny U.S. producers
access to important inputs and give the Chinese manufacturers
that have access to the raw materials an unfair advantage.
- Quotas on imports of fertilizer, a significant U.S.
export, were not administered in a timely or transparent
manner in 2002 or 2003, resulting in barriers for
U.S. companies seeking to export to China.
- Questionable use of biotechnology and sanitary
and phytosanitary rules are hindering U.S. farmers’
efforts to export to China. Similarly, lack of transparency
and other problems with the allocation of Tariff Rate
Quotas have limited the ability of U.S. producers
to access the growing Chinese market for agricultural
products.
- Lack of effective enforcement of intellectual property
rights means U.S. inventors and innovators continue
to be plagued by piracy and counterfeiting of their
products. Violations of copyrights on film, music,
software and pharmaceutical products and counterfeiting
of consumer goods and industrial parts continue to
be serious problems in China.
- China still maintains restrictions on the trading
and distribution rights of foreign businesses. U.S.
businesses seeking to import, export and engage in
the distribution of products in China continue to
face restric-tions due to the violation of China’s
WTO commitments.
Dai Yan, “Foreign Trade Soars back into Black,” Web
site: www.chinadaily.com, January 5, 2005.
U.S.-China Business Council, “U.S. Exports To China
Rise,” September 1, 2004.
U.S. Department of Commerce, Office of the United
States Trade Representative, 2003 Report to Congress
on China’s WTO Compliance.
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