USTR Says Decisions to Allow China and Russia Into WTO Were Mistakes
China continues to flout the spirit of World Trade Organization rules, casting doubt on the wisdom of allowing it to join the body in 2011 on the terms it was offered, the Office of the U.S. Trade Representative said in a report on China’s WTO compliance released Jan 19. Hopes that China would become an open market economy “were disappointed,” and China continues to deploy market-distorting policies that the WTO trade rules were not formulated to address, limiting market access for imported goods and services while providing government support to Chinese industries, USTR said. “It seems clear that the United States erred in supporting China’s entry into the WTO on terms that have proven to be ineffective in securing China’s embrace of an open, market-oriented trade regime,” it said.
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The situation is worse today than it was five years ago, the report said. In areas such as intellectual property and technology transfer, market access for information and communications technology products and regulation of agricultural biotechnology products, “China has shown a willingness to take modest steps to address isolated issues, and it will sometimes make broader commitments when pressed at very high levels, but it is not prepared to follow through on significant commitments or to make fundamental changes to its trade and investment regime,” the report said. “It is difficult to envision this troubling situation changing significantly as long as China continues to remain committed to an economy dominated by the state and built on mercantilist industrial policies,” it said.
Similarly, Russia’s actions “strongly indicate that it has no intention of complying with many of the promises it made to the United States and other WTO Members,” USTR said in a concurrent report on Russia’s WTO compliance. “This trend is very troubling.” Steps taken by Russia to implement scheduled tariff reductions and notify the WTO of new draft regulations are positive steps that “are the exception, not the rule,” the report said. “Importing into Russia remains a difficult task,” given Russia’s “burdensome and opaque” import licensing scheme and a “less than transparent customs legal regime,” USTR said. “It was a mistake to allow Russia to join the WTO if it is not fully prepared to live by WTO rules.”