A review of “China and the WTO” by Petros C. Mavroidis and André Sapir

Early hopes that China’s admission to the World Trade Organization would prompt Beijing to undertake far-reaching economic and political reforms have been dashed. Instead, the expansion of Chinese exports following the country’s accession to the WTO in 2001 has resulted in a chronic trade dispute with the United States. Mavroidis and Sapir focus on the problems for the world order created by China’s continued reliance on state-owned enterprises (SOEs) and its policy of forced technology transfer. The country, they acknowledge, is unlikely to significantly change its economic system in response to foreign pressure. It is doubtful, in particular, that bilateral negotiations with the United States will lead to meaningful reforms. Only multilateral pressure exerted through the WTO can ensure that China’s state-owned enterprises operate more in line with the market and can encourage the country to strengthen its intellectual property protections. The authors suggest that China adopt the state-owned enterprises and intellectual property provisions of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, the recently negotiated Asia-Pacific trade agreement. They argue that Beijing may well agree to submit to WTO rules and embrace the organization’s liberal spirit in return for admission to the main regional trade deal.

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