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World Bank Backs China's WTO Accession
The World Bank's chief representative in China predicted this weekend that a growing number of people will realize that China's entry into the World Trade Organization (WTO) will mean the United States would have wider access to a large new market.
Americans "will have more jobs, better jobs and they will earn a lot of money in the process," said Yukon Huang, director of the bank's China Programme.
He predicted that US permanent normal trade relations (PNTR) with China would be passed by a slight margin by the House of Representatives in the vote set for next week.
Huang also said the World Bank is willing to help China deal with any challenges bought up by entry into the WTO.
His remarks came at a time when China and the bank are commemorating two decades of co-operation. On May 15, 1980, China resumed its membership in the international financial organization, which provided US$32.5 billion worth of funding to China in the past 20 years.
The US Government, which last November struck a deal with the Chinese Government on China's accession into the WTO, is seeking to normalize trade with China to lock in the benefits of the deal.
Huang said: "US congressmen, in their hearts, may realize they should be supporting it (the PNTR) because they know, in the long run, that American interests will be promoted."
But many congressmen are under pressure from labour unions that have vigorously campaigned against passage of PNTR. The unions are concerned that China's membership in the WTO will lead to more Chinese imports in the US market, causing the elimination of jobs in some industries, such as textiles, Huang said.
But Huang said these unions are "short-sighted."
The effects of China's WTO entry on US labour will be positive on balance, he said.
"Far more workers in the United States stand to benefit from the passage of PNTR," Huang said, "but the benefits have not been clearly identified.
For example, "with the passage of PNTR and WTO, there are many opportunities to invest, to develop and to produce things for the service sectors in China, such as in insurance and finance. So many more people in the US would be employed in these areas," he said.
"But they are not currently working in these areas. Since they are not there, they cannot lobby for (the PNTR)."
Huang said WTO entry would accelerate China's adjustment to the market-based economic system.
The bank would help China in developing its competitiveness, a tough task the country will face after the entry, he said.
Strengthening and reforming the research and education sectors would be a key issue in sharpening China's edge in global competition, he said.
Huang said the bank would help China make research better serve economic and social development and reduce its dependence on the State budget. The bank would also assist China in increasing access to education and improving the quality of education in the western areas, he said.
Huang said rather than focusing on providing financial support to help China achieve a rapid economic growth rate, which it has done for the past 20 years, the bank would shift the focus to "improving the quality of the growth."
Huang said the bank would help China address some complicated development issues. These issues include environmental problems and urban planning in major cities like Beijing, Shanghai and Chongqing and the development of China's western regions.
He said these areas need a "multi-faceted" approach, which means many aspects such as the environment, investment and social consequences must be weighed.
Huang said China has been the bank's strongest performer over the past two decades.
"Very few countries have 20 years of history of such a steady financial relationship (with the World Bank). In other countries you see cycles - periods when we don't lend much, periods when policies go really badly and the bank doesn't have a role," he said.
He said the bank plans to lend US$1.5 billion to US$2 billion to China in 2000.
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