Evaluate Costs and Benefits for China of Joining the WTO

Today, China is one of the most rapidly progressing world’s economies. The economic growth of the country allows the country to close the gap which separates it from leading capitalist countries of the world. At the same time, the rapid economic development of the country is closely intertwined with the dramatic change in the economic policy of the country which occurred in the 1980s, when China has started economic reforms which positive effects can observed nowadays. In such a context, it is important to understand that the economic reforms and transformations that have already taken place in China lead not only to considerable economic progress of the country, but also to the change of its socioeconomic system, which is traditionally closely intertwined with the political system in China. In fact, today, China attempt to introduce principles of open market economy and adopts the capitalist economic system, which apparently contradicts to the communist nature of the regime ruling in China. In other words, economic policies of the state aim at the development of capitalist economy, while the political system is still communist with the Communist Party being the only political party and power in the country.

Nevertheless, the ongoing development of Chinese economy contributes to the rapid progress of this country since within the last couple of decades China has reached the unparalleled level of the economic development. What is more important, Chinese economy keeps booming and its strengthening creates conditions for the leadership of China as the world economic superpower. Even though today it is hardly possible to speak about the total leadership of China in the global economy, but it is still necessary to underline the fact that the economic development of China is very fast, while the integration of China in the global economy, especially within the last decade, has contributed consistently to the expansion of Chinese economic influence in the world. In this respect, the membership of China in the World Trade Organization (WTO) and the progress of free trade in global terms opens larger opportunities for Chinese economy to enter new markets and benefit from international trade, including trade with leading countries of the world, such as the US, the EU, Japan and others. In such a context, the membership of China in the WTO, which the country gained in 2001, is an important factor that influences the further development of the country. On the other hand, it is important to lay emphasis on the fact that Chinese membership in the WTO affects not only China but also other member-countries and, what is more, Chinese membership in the WTO has not only positive effects but negative ones. Hence, while joining the WTO, China had to take into consideration whether benefits of this membership will outweigh the costs the country would have to pay for it. However, even today, it is hardly possible to give a definite answer to the question of costs and benefits of Chinese membership in the WTO because China has got both, but still it is obvious that to maintain the ongoing economic growth, China needs badly the free access to international markets and the membership in the WTO gives China larger opportunities to meet this strategically, if not to say vitally, important goal.

Leave a Reply