Short of a miracle, the chances of Beijing clinching a deal with Washington on World Trade Organisation entry before the body's ministerial meeting in Seattle next month are slim. Privately, senior Beijing leaders are said to have begun contemplating the possibility of a failure to secure a WTO agreement, but still hope to work out an arrangement with the global body allowing it to take part in the new round of talks to set international trade and investment rules. The mainland was an observer in the Uruguay round of talks and participated in previous negotiations on global textile trade. So, there is no reason why a similar arrangement cannot be worked out. But what if Beijing wants to have a bigger voice in the new round of ministerial talks starting on November 29? It does seem weird the world's 11th biggest trading nation does not have a say in the new round of trade talks, which will be likely to raise the entry price for future WTO membership. There is no precedent in having a non-member fully participating in WTO talks. One last window of opportunity exists if the two sides can find the will to reach an in-principle deal before the Seattle meeting, and agree to settle outstanding differences before the United States Congress votes on extending Beijing's Normal Trade Relations (NTR) status. US President Bill Clinton does not need congressional approval for a WTO deal with Beijing, but has to secure its approval to extend permanent NTR status, which would allow mainland goods to enjoy the same US tariff rates as exports from other countries. At present, the US Congress votes yearly on the mainland's NTR status, making it a thorn in US-Sino relations. If Mr Clinton can secure a favourable WTO deal for US business from Beijing, he stands a good chance of convincing Congress to grant permanent NTR status. US officials have been quoted as saying that Beijing has not been negotiating in earnest in recent talks, either because of brinkmanship or its inability to gather the political will to make the key concessions necessary for a deal. This is despite attempts to break the deadlock by Mr Clinton and Treasury Secretary Lawrence Summers. Mr Clinton telephoned President Jiang Zemin on October 16, urging him to try and seal a deal. His Chinese counterpart was said to be non-committal. Premier Zhu Rongji was also said to be cautious about any WTO commitments in his meeting with Mr Summers in Lanzhou last week. Increasingly, mainland officials said while they wanted WTO entry, they would not take it at the expense of national interests. A key sticking point is that Beijing is adamant about not opening its financial services, telecommunications and agricultural industries as wide as the US wants, fearing this would disrupt and even wipe out many domestic companies and jobs. With the economy growing at its slowest pace since 1990, and as social stability emerges as the single most important concern, Beijing looks set to stick to its guns - and seems prepared to sacrifice a place in the WTO if the US is reluctant to lower its demands. Arguably, the biggest advantage of staying out of WTO is that it gives more time to restructure sickly state enterprises and a technically insolvent state banking system. The big unknown is whether there is the political will to reform a matching competitive streak to meet the challenges that WTO membership would bring. The next time Beijing applies for WTO membership it will be under the new trading rules and the price will be even higher in terms of concessions. Of course, a failure to gain entry means Beijing will have to live with the yearly hassle of relying on the US Congress for approval of NTR status.
