China’s economic system and its accession to the WTO

Abstract

In moving towards becoming a market economy, China has made dramatic strides since embarking on reforms in 1978, but liberalizations have been accompanied by inflationary booms followed by bouts of social instability. These last account for much of the caution in China’s approach to joining the World Trade Organization, which is seen as critical to securing further foreign direct investment, foreign technology and access to foreign markets—all necessary to economic growth and development. There is a reluctance to make firm commitments to abide by WTO rules on a schedule faster than that expected of developing countries. Perhaps the commitments required could be undertaken in confidence-building stages.