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China weighs sacrifices as GATT plays by rules

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SCMP Reporter

CHINA's bid to re-enter the General Agreement on Tariffs and Trade (GATT) appears to be on somewhat shaky ground right now.

Joining any club requires friends, or sponsors, and acceptable behaviour. In place of friends, China is being subjected to a volley of antagonistic questions from would-be sponsors while its shrouded modus operandi is not being viewed as strictly gentlemanly.

There are just too many anomalies for the developed world to accept: a manipulated exchange rate, price fixing and invisible trade barriers - all of which, and more besides, are a direct kick in the teeth to the free trade which the GATT seeks to promote.

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For China, to join is to change: to sacrifice control and bring its behaviour on currency and other issues more in line with those adopted by other countries. Membership will not come cheap.

On the other hand, the long-term benefits are huge - particularly if the dragging Uruguay Round is concluded - with greater liberalisation in the areas of textiles and agriculture, two keystones of China trade.

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Hongkong traders and manufacturers, whose cross-border operations are flourishing, would also feel the cost and other benefits of China's membership.

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