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Although fruitful for sectors like finance and banking, China’s WTO member has not proved to be that much lucrative for the agriculture sector of China since it provides both opportunities and threats for the country’s economy. At one hand, China’s decreasing tariffs of agricultural exports attracted global market thereby causing a considerable boom in the year 2004 in which China’s agricultural exports raised to $17. 3 billion.
At the other hand, as a result of free trade China faces a major threat in terms of the competition for domestic grains like corn and soybeans with the imported grains of better quality thereby snatching the livelihood of many farmers and people related to the agriculture sector. For the very reason, China has not opened its market of agricultural products as much as it has for the manufactured goods. Another reason behind a non restricted import of agricultural goods is that such a step on China’s behalf would have led to a trade deficit.
Keeping in mind China’s growing population, China’s import would have superseded its export in case of non-protectionism. Also, China faces a risk of suffering losses because such products are easily infected and such a scenario can not only leave a scar for China’s growing international repute but can also cause a major set back to the Chinese exporters. Impact of China’s membership of WTO on China’s Manufacturing Industry: The manufacturing industry of China represents one of the major successes pertaining to the membership of WTO.
Because of the cheaper prices of China made goods in the international market, the demand of these products is ever increasing. In case of manufacturing of automobiles, China has been excelling since 1975 but the major boom after its membership of WTO indicating a production percentage increase of 41. 3 percent in a single year when its production number raised to 3. 25 million in the year 2002. Today, the China’s automobile industry stands among the world’s top automobile giants.
In the case of China’s Telecommunication Industry with China having entered 2nd generation of mobile communications equipment, china has launched its replica mobile phone. Unusually similar in appearance to the high quality branded cell phones, china made replica mobile phones are cheaper enough to satisfy a number of customers across the globe. Impact of WTO membership on China’s International repute: Having discussed the impact of WTO membership on China’s economy, what remains worth mentioning is a series of changes for the other sectors of the country.
The impact of globalization is not just confined to the financial gains but has also left a strong image of China thereby hushing away the chances of any other world war in future. For the pro-globalists, globalization has opened new horizons for China to reach out to the world. This has resulted in an ascendance of China’s products across the world. The proliferation of China made good across the world are so wide that it has left U. S. with a ‘China Street’ in the New York City and Pakistan with a ‘China Market’ in the country’s capital.
Both these markets are peculiarly meant for the selling of China made goods that are much cheaper as compared to those made by other countries. It is the result of internationalization that China has permeated into every corner of the global community by attracting the customers with its cheaper prices. But the other side of the coin suggest contrary to the positive side WTO membership on China’s international repute. The exemption of trade barriers encourages the flow of infections and diseases through products from one place to another.
SARS stands as one such example that had left many people at the verge of death. It was in first few months of the year 2003 that marked the outbreak of SARS. “Originating in southern China in late 2002 (or earlier by some accounts), the epidemic quickly infected more than 8,000 people in 30-plus countries, causing nearly 800 deaths within six months. By the time the disease was finally brought under control, Beijing’s initial mishandling of the crisis, as well as the SARS scourge itself, had taken a serious toll on China’s economy and its international reputation.
” Impact of WTO membership on China’s Legal System: Gregory C. Chow in his article ‘The impact of joining WTO on China’s economic, legal and political institutions’ suggests that the WTO membership of China has not only resulted in economic boom but has also brought an amelioration in the legal system of the country. He lays his assumption on the fact that by WTO membership China is dealing with a number of international firms. The exposure of foreign laws would positively affect China to pave its way to legal modernization.
Also, it is in the aggrandizing phase of globalization that China has enacted many commercial laws that involve the laws pertaining to bankruptcy and corporate behaviour. It is a direct result of this fact that the number of Chinese legal personnel continue to increase. With WTO membership, this move towards globalization is further facilitated thereby suggesting a further amelioration of China’s legal system. Impact of China’s membership of WTO on other nations:
Of all the corollaries of China’s entrance into the World Trade Organization, the global competition supersedes providing both the optimistic and pessimistic implications for the world. At one hand the increasing competitive has triggered a wave of fear for many smaller economies by dragging them at the verge of economic fiasco. At the other hand, the same competitiveness has fostered the production of high quality products and innovative technologies employed by the competitors. China’s accession to WTO demanded a decline in China’s tariffs on goods.
These tariff barriers were employed by China as a technique of economic protectionism in order to flourish the domestic industry that might have faced overwhelming competition by the entrance of foreign goods with low tariffs. Making it crystal clear, the WTO membership not only opened new opportunities for China to globalize its export but with the ascendance of export the integration also caused the increase of import by China being forced to lower the tariffs on imported goods.
According to the findings of Dorothy Guerrero in ‘China, the WTO and Globalization: looking beyond growth figures’ China had to lower down its overall tariffs on agricultural goods from 54 percent in 2001 to 15. 3 percent in 2005. However the net results favoured China in a sense that even in the absence of high tariffs, some invisible barriers for the products of foreign countries were still implemented by China. These non tariff barriers indirectly dissuade the participants of international trade market from progressively entering China’s domestic market.
These non tariff barriers involve issues pertaining to stringent security check, product certification, labelling standards, delay in customs clearance and import approval. The stringency of these national non tariff barriers significantly differ from the international standards and often keep varying from time to time. As a result of rejection based on these national standards, foreign manufacturers suffered a great loss especially in terms of agricultural products.
This rejection has lessened their share of goods exported to China. Apparently being insulated from the economic progress and WTO membership of China, Chinese Politics also experiences changes in terms of the preference of communists or democrats. Just like WTO demands free trade and rights of all the nations, the Chinese citizens of future can be predicted to unanimously demand democracy for the rights of every citizen.
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