European Trade with China
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Code : ITF0018
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Region : :China Europe |
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LAYING THE FOUNDATION The first trade agreement between EC and China in 1978, gave boost to the trade between the two regions. The “Trade and Economic CooperationAgreement” of 1985, replaced the 1978 agreement. The important aspects of the 1985 agreement were – to give the ‘Most Favored-Nation’, status in the areas like taxes and other internal charges levied on the products imported or exported, regulations and procedures related to transit, shipment and warehousing of the products exported or imported, customs, duties and all other charges applied to the export, import or transit of the trade commodities and the procedures to collect duties... ECONOMIC REFORMS AND WTO Economic reforms in China began in 1978, when Deng Xiaoping opened up the Chinese economy and integrated it with the global economy, thereby increasing China’s foreign trade. The importance and achievements of these reforms were described in a paper called ‘A Long Term Policy for China-Europe Relations’ in 1995 – “At the beginning of the reformperiod in 1978, total Chinese trade amounted to $20 billion andwas roughly balanced... TRADE CONSTRAINTS IN CHINA Economic regulations inChina were not transparent.Most of the regulations were unwritten. Even in some written cases, they were subjected to individual interpretation (reference was made to unpublished, secret provisions) and frequent changes. “In conclusion, this lack of transparency, predictability and reliabilitymeans that businesswithChina remains a high-risk activity which for the moment can only be taken on by major corporations and not yet by small andmedium-sized enterprises... |
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RAPID TRADE GROWTH “To reach this goal, China has set the target of bilateral trade reaching 150 billion US dollars by 2007, and more objectives been set for up to 2020.”14 On November 24th 2003, China signed “China’s EUPolicy Paper”, which specified the course of action required till 2008, to achieve the target.Analysts believed that China’s implementation ofWTOregulationwould increase the EU exports to China, by reducing the import tariffs and other non-tariff import barriers. It was opined that this would result in reducing the EU’s trade deficit with China...
