[House Document 107-146] [From the U.S. Government Publishing Office] 107th Congress, 1st Session - - - - - - - - - - - House Document 107-146 CHINA'S MEMBERSHIP IN THE WORLD TRADE ORGANIZATION __________ MESSAGE from THE PRESIDENT OF THE UNITED STATES transmitting A REPORT CERTIFYING THAT THE TERMS AND CONDITIONS FOR THE ACCESSION OF THE PEOPLE'S REPUBLIC OF CHINA TO THE WORLD TRADE ORGANIZATION ARE AT LEAST EQUIVALENT TO THOSE AGREED BETWEEN THE UNITED STATES AND THE PEOPLE'S REPUBLIC OF CHINA ON NOVEMBER 15, 1999
November 13, 2001.--Message and accompanying papers referred to the Committee on Ways and Means and ordered to be printed To the Congress of the United States: In accordance with the requirements of Public Law 106-286, I hereby transmit the attached report certifying that the terms and conditions for the accession of the People's Republic of China to the World Trade Organization are at least equivalent to those agreed between the United States and the People's Republic of China on November 15, 1999. George W. Bush. The White House, November 9, 2001. Report on Certification of the Terms and Conditions for the Accession of the People's Republic of China to the World Trade Organization The People's Republic of China (China) is the world's largest economy that is not yet a member and full participant in the World Trade Organization (WTO), the international organization responsible for overseeing the negotiation and implementation of global trade rules. China is also the eleventh largest export market for U.S. goods and services. After nearly fifteen years of negotiation, China is now in a position to become a WTO member. Based on the outcome of China's WTO accession negotiations, I am pleased to certify that the terms and conditions for China's accession to the WTO are at least equivalent to those agreed between the United States and China on November 15, 1999. The United States welcomes China's membership in the WTO based on the terms and conditions that we and other WTO members endorsed in September. WTO members will meet in November and are expected to approve those terms and conditions for China's accession. At this same meeting, WTO members will also approve the terms and conditions for Taiwan's accession to the WTO. Beginning the negotiations on joining the international trade community was an important step for China as it embarked on a road toward economic reform, moving from a centrally- planned economy to one with a vibrant and growing private sector based on entrepreneurism and competition. The conclusion of those negotiations, and the implementation of the commitments agreed to, will accelerate and reinforce China's reform process and create new opportunities for China's people and for American exporters and workers. China is reforming in many ways its laws and practices and WTO membership will require China to provide greater access to its economy and more openness in its society. Subjecting broad aspects of its economy to internationally agreed trade rules that are enforceable in the WTO will help build reliance on the rule of law in China and have a positive effect on broader aspects of China's society. China's membership in the WTO will benefit the United States through increased trade opportunities, more certainty and predictability in our trade relationship, and China's greater exposure to the principles of fairness and competition that guide our economy. For Americans to realize these benefits, however, we need to change the basis of our trade relationship with China. In 1980, the United States and China established normal trade relations (NTR--then called ``most favored nation'' status) status with each other based on a bilateral trade agreement negotiated and approved under provisions of U.S. trade law known as the ``Jackson-Vanik Amendment.'' Each year since then, the United States has renewed NTR status through an annual waiver process. On November 15, 1999, the United States and China agreed bilaterally on terms for China's accession to the WTO. These terms included commitments from China on market access for U.S. exports of industrial and agricultural goods and services, conditions under which companies could provide services in China, and rules that eliminate trade barriers in China and permit the United States to address imports from China that injure U.S. industry and workers. A strong bipartisan coalition in Congress recognized the merits of the 1999 agreement, and enacted legislation authorizing the President to terminate application of the Jackson-Vanik Amendment to China and to grant products from China permanent NTR status after he certifies that the terms and conditions for China's WTO accession are at least equivalent to those agreed between the United States and China on November 15, 1999. China has concluded bilateral agreements on its accession to the WTO with the more than 40 Members requesting negotiations. Multilateral negotiations on the terms and conditions for China's accession to the WTO, involving all interested WTO members, including the United States, concluded in September 2001. The consolidation of the results of these bilateral and multilateral negotiations has produced the final China accession package that WTO members will formally consider and approve. All of the commitments agreed between the United States and China in November 15, 1999 are in the terms and conditions for China's accession to the WTO. In several respects, China's negotiations with other WTO members and the results of the multilateral negotiations clarify and improve the enforceability of commitments made to the United States in 1999, provide more or faster market access than China agreed with the United States and address important matters not included in the U.S.-China November 1999 bilateral agreement. China has also agreed that its central and local governments all will honor WTO obligationsand that it will invite public comments on its trade-related laws and regulations before they are enforced. These additional commitments lay a strong foundation for effective implementation of the terms for China's accession to the WTO.\1\ --------------------------------------------------------------------------- \1\ A more extensive summary of the terms and conditions of China's accession to the WTO accompanies this certification report. In addition, pursuant to Section 122 of the Uruguay Round Agreements Act, the U.S. Trade Representative will transmit to Congress copies of China's WTO accession package. --------------------------------------------------------------------------- In the multilateral negotiations involving the United States and other WTO members, China has agreed to detailed rules on how it will implement provisions agreed to in November 1999, such as phasing-out its quotas and providing access for agricultural products and fertilizers under tariff-rate quotas. When other WTO members reached agreement with China on more favorable terms for market access, the overall package improved. Under China's WTO accession terms, Americans will benefit from more favorable tariff cuts on products such as orange juice and auto parts, improved access under tariff-rate quotas, and fewer restrictions on providing legal, educational, and other services than those agreed to in November 1999. As a main participant in the multilateral negotiations from their beginning in 1987, the United States recognized the need for China to undertake systemic reforms and joined with other WTO members in achieving this objective. China has agreed to provide foreign governments and individuals access to its regulatory and decision making process. Other systemic reforms, including enhanced access to judicial review of regulatory decisions and uniform, nondiscriminatory administration of its laws, regulations, and other measures will help make China's commitments on market access for U.S. products and services more meaningful. WTO members also recognized the need to monitor China's implementation of its commitments. China has agreed in its accession package to a process of annual review of the implementation of commitments. The annual review process will supplement the dispute settlement process that will apply to China when it becomes a WTO member. China has undertaken important commitments requiring major changes that some in China will resist. We will look to China to implement all its commitments fully and are prepared to work with China in the WTO and bilaterally to assist China's officials in meeting those commitments. An interagency team, including representatives of the Office of the U.S. Trade Representative and the Departments of State, Commerce, and Agriculture, is already directing staff and other resources to the effort of monitoring China's implementation of its commitments. We will be working closely with Congress and the private sector as we use all bilateral and multilateral fora to raise and resolve issues. Moreover, we will enforce our rights under the WTO Agreement, including China's negotiated terms of accession, through our trade laws and through the WTO dispute settlement process, as necessary. China's accession to the WTO will bring the trade relationship between our two countries to a new level. China will now be a full participant in the international trading system with all the rights and responsibilities that membership entails.