U.S. TRADE OFFICIAL OPTIMISTIC ON CHINA WTO NEGOTIATIONS
(Senses change in political winds from China)
By Bruce Odessey
USIA Staff Writer

Washington -- The first serious negotiations on China's accession to the World Trade Organization (WTO) are about to begin, a U.S. trade official says.

Martha Cheng, director of China affairs in the Office of the U.S. Trade Representative (USTR), says Chinese negotiators finally seem willing to make what she considers viable offers.

"To be candid, to date the Chinese have really offered very little," Cheng told a Bankers' Association for Foreign Trade conference February 7.

Since a November meeting between President Clinton and China's President Jiang Zemin at Manila, however, "the political winds have changed. We are now well positioned to enter serious negotiations," she said.

Cheng said a late February meeting of the WTO working group on China's accession, at which China is expected to make new offers on reducing tariffs and eliminating non-tariff barriers, should indicate whether her present optimism is warranted.

Already, she said, China has backed away from a position demanding blanket developing-country status for all its sectors and has agreed to what is called a standstill -- a pledge not to raise new trade barriers during negotiations.

Nevertheless, negotiations will not be easy, she said. They deal with three packages:

-- a rules package including national treatment (equal treatment for Chinese and foreign companies); trading rights (exporting and importing without state license or other government permission); and a pledge not to manipulate foreign exchange rates for trade advantage.

-- a market access package requiring elimination of all WTO-inconsistent tariffs and non-tariff barriers over a reasonable period of time.

-- safeguard provisions allowing China's trade partners to impose temporary duties to protect their industries from a surge of Chinese imports.

"We have made progress," Cheng said. "There seems to be a change in tone."

Also -- for now, anyway -- the United States and its trading partners are united in the WTO working party negotiations, she said. Back in November, in contrast, European Union trade commissioner Sir Leon Brittan was complaining that the United States was erecting "very high hurdles" for China.