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. 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. Hongkong traders and manufacturers, whose cross-border operations are flourishing, would also feel the cost and other benefits of China's membership. Indeed, for the region as a whole it is advantageous to have China ensconced within the GATT system with all speed - which could be why the ASEAN countries are wholeheartedly pushing for a rapid integration. But for the big boys - America, Europe and Japan - re-admitting China is a step to be treated with caution. Only a full-scale probe will satisfy them as to how, and when, it intends acting as a fit and proper member of an international 108-member club. One of the biggest question marks hovers over China's dual exchange rate system - an issue which could well embrace the devaluation of the yuan, which is seen as a key factor in the burgeoning trade deficit. The US says the exchange rate system operating in China breaches Article XV of GATT. China says it is working towards a single exchange rate, but will not put any time limit on the process. The US is also complaining about the impossibility of getting an overall picture of the economy from the information provided in the past. The US and Europe are raising tentative queries about the sliding-scale customs duties that vary depending on the port of entry and the importer. They have asked for more specific information on investment in the Special Economic Zones and exports from the zones to the rest of China. Agricultural subsidies and the use of intermediaries between the foreign exporter and Chinese retailer are also prompting questions. No one is going to rubber-stamp the application, and the toughest antagonists will drag in everything they can. They will find rich pickings. Speaking in Hongkong earlier this month, the deputy director-general of GATT, Mr Charles Carlisle, said he was convinced it was just a matter of time before China joined. His optimism is encouraging. But that matter of time will almost certainly be fraught with mud-slinging as China's relations with Japan and the Western world enter a new phase. - LOUISE LUCAS
