Organizer: Donald C. Clarke, University of Washington
Chair: James V. Feinerman, Georgetown University
Discussant: William Alford, Harvard Law School
The purpose of this panel is to look at China's participation in the world economic order from the standpoint of its domestic economic and legal institutions. The pace of China's recent economic reforms, dictated largely by the government's desire to be a founding member of the World Trade Organization (WTO) at the beginning of 1995, has made it clear that it is no longer possible to understand China's economic and legal institutions without an understanding of the international context in which they exist. At the same time, it is not possible to understand China's actions in the international economic arena without understanding the domestic forces behind those actions.
Since embarking on economic reform in the late 1970s, China has become more and more closely involved in the world economic order. A major symbol of its abandonment of a policy of autarky has been its application to join the General Agreement on Tariffs and Trade (GATT). The recently completed Uruguay Round of GATT negotiations has called for the establishment of a new trade body, the WTO, which will officially come into being in 1995. China's desire to be a member of the GATT by that time, and thus a founding member of the WTO, has led to the current intense negotiations between China and the major GATT powers.
This panel is an effort to gather scholars knowledgeable on the one hand about China's domestic economic and legal institutions and on the other hand about the GATT and international trade. China's imminent participation in GATT is going to have immense ramifications not only for the GATT itself, but also for China's domestic institutions. This panel is not a panel about internationaeneric term. This paradox of the absence of a generic term vis-à-vis the presence of multifarious nomenclatures clearly indicates a deficient understanding of the nature of fictional narrative, perhaps due to the nascent stage of the genre. A generic study of fiction remained an untackled task until the late Ming.Hu Yinglin (1551-1602), though better known as a prominent poet and poetician, was also one of the late Ming literati who pioneered the generic study of fiction. In his biji collection Shaoshi sha with China's trade partners. The third (Clarke's) will look at the more general issue of how certain fundamental features of China's domestic legal and economic order clash with the principles of the GATT. The panel is well balanced in a number of ways. Clarke is a legal academic and Lardy is an economist, both specializing in China. Qin, a Chinese national and practicing lawyer, clerks at the United States Court of International Trade and will shortly be in practice with Cleary, Gottlieb, a major New York law firm. She brings to the panel a rare combination of intimate familiarity with trade issues and Chinese as well as American legal training.
Whether or not China attains its goal of becoming a founding member of the WTO, it seems clear that its accession to the General Agreement on Tariffs and Trade (to be administered by the WTO) is simply a matter of time. By the time of the AAS meeting in March, 1995, China will either already have become a member or be on the verge of doing so. Thus, this panel is especially timely.
Donald C. Clarke, University of Washington
This paper will discuss how the structure of China's domestic legal and economic order is likely to result in sharp and continuing conflict with other members of the World Trade Organization (which administers the General Agreement on Tariffs and Trade) after China's accession.
Whether or not China joins the GATT in time to become a founding member of the WTO on January 1, 1995, its eventual accession seems assured. The differences between China and the major GATT nations such as the United States are not over the basic question of whether or not China should be allowed to join. The debate is instead over how far China should have to go in reforming its economy before its institutions are judged sufficiently GATT compatible.
Commentary on this issue has so far tended to focus on Chinese legislation-whether China has passed this or that law demanded by the United States and others. In addition, there is by this time widespread awareness that passing laws is not enough-that China has serious enforcement problems, especially outside the major cities. This paper will go beyond these observations and show how certain fundamental aspects of China's economic and legal order clash with what is expected and assumed within the structure of the GATT. For example, the GATT desideratum of transparency in administrative regulations is fundamentally at odds with the Chinese conception of the relationship between government and the governed. In many ways, for China to fit well into the GATT, it would have to stop being China.
Indeed, the incompatibility of much of China's politico economic structure with the principles of GATT is precisely why China's membership is strongly supported by domestic reformers. Their principal concern is not trade at all; it is to use the GATT as a stalking horse to dismantle the institutions they feel are standing in the way of domestic reform.
Unlike the other papers in this panel, this paper will not look at substantive policy issues. It will look instead at the domestic legal and economic environment within which problems over substantive policy issues will occur and must be resolved, and at the factors limiting the range of possible solutions.
Ya Qin, Cleary, Gottlieb, Steen and Hamilton
Protection of intellectual property rights has become one of the most controversial issues in China's foreign trade relations. The United States is taking the lead in pushing China to provide broader and more effective protection for patent, trademark and copyright owned by foreign persons. Besides using its own law to unilaterally press the Chinese, the United States has raised the issue of inadequate intellectual property protection to object China's early accession to the General Agreement on Tariffs and Trade (GATT) and its successor, the World Trade Organization (WTO), which has newly incorporated intellectual property into the rules of international trade.
How should China respond to the international pressure in the area of intellectual property? What are the political, social economic and legal issues that China confronts in this area?
To answer these questions, this paper will examine the following: the relationship between protection of intellectual property rights and liberalization of international trade; the changing view in the West and the views of developing countries toward international protection of intellectual property; the traditional Chinese view (or lack of it) toward intellectual property; China's conflicting interests in the intellectual property area; and the status of intellectual property protection in China. The paper will also suggest the courses that China might take to respond to the international challenge.
Nicholas R. Lardy, University of Washington
This paper will analyze the degree to which China's emerging industrial policy constitutes a significant new obstacle to China's participation in the General Agreement on Tariffs and Trade (GATT), the world's most important international trade organization. In the early 1990s China's trade volume was larger than any other country that was not a participant in the GATT. To facilitate its acceptance by other GATT participants and in particular to gain acceptance by the end of 1994 so that it could become a founding member of the World Trade Organization (WTO) that will replace the GATT at the beginning of 1995, China by mid 1994 had reduced from several thousand to about four hundred the number of GATT inconsistent non tariff barriers, mostly quantitative restrictions and import licensing requirements; increased the transparency of its trading system; reduced significantly tariffs imposed on a broad range of imports; and eliminated its dual exchange rate system and increased considerably the degree of convertibility on current account transactions.
However, in an apparent step backward the State Council in mid l994 promulgated a general industrial policy as well as a specific industrial policy for the automobile industry. The latter contained a number of provisions that appear to be inconsistent with the newly negotiated Uruguay Round of the GATT. Special industrial policies for six other industrial sectors have been drafted and will be issued as soon as they are approved by the State Council.
This paper will analyze China's progress in improving market access, focus in particular on the degree to which new industrial policies in automobiles and other sectors are not consistent with China's commitment to comply with the terms of the WTO Agreement.
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