Business law - chinese trade and investment law Essay

Business law - chinese trade and investment law - Essay Example Significantly, in accordance with the principle of the balance between rights and duties, once China joins the WTO, China is said to be able to enjoy a "most favoured nation status" (Chen 2000). China's interest in WTO according to Chen (2000) is thus - ".the multilateral, stable and unconditional most favoured nation status provided by the WTO members and the achievements gained by other countries and regions from trade liberalization, [the participation] in the formulation of international trading rules, and [utilization of] the WTO's multilateral dispute solution mechanisms to safeguard China's rights and interests" According to the Fact File of the World Trade Organization (2005), the WTO is the only global international organisation dealing with the rules of trade between nations. Its goal is to help producers of goods and services, exporters, and importers conduct their business through agreements, negotiated and signed by the world's trading nations and ratified in their parliaments. Established on 1January1995, and created by the Uruguay Round negotiations (1986-1994), the organization is based in Geneva, Switzerland where 148countries (on 13October2004) are members. It has a budget of 169million Swiss francs for2005 and is now headed by Pascal Lamy as Director-General. The Fact File (2005) furt... Will joining the World Trade Organisation assist or hinder China's Development From the perspective of Rao (2001), a Chinese biotechnologist and food scientist, yes, China's joining the WTO in the long run will assist its development. Speaking before the WTO, he said China is aware that in so doing, some of its domestic food manufacturers will be hurt or damaged, just as others will not be. The Chinese government are also aware there could be initial shocks in agriculture and food industry, but in the long run "will be converted into a powerful driving force for its development." There are two views over the past years regarding China's accession to WTO: the optimistic view and the pessimistic view. The optimistic view reasons that the availability of cheaper supply food ingredients with higher quality after China's joining the WTO will give competitive edge to Chinese food industry in the international market (Rao 2001). In addition, the optimists say, China's membership will promote the rule of law in the country, undercut state power in controlling the lives of people, and accelerate China's transition from a command economy to a market economy. China's entry will also help modernize accounting, banking, legal, telecommunications, and transportation systems of the country, at the same time reduce corruption, favouritism, and local protectionism (Yu 2001). On the other hand, the pessimistic view says freer international trade and investment will strengthen the competitiveness of foreign food business in China, shrinking the domestic market for manufactured foods on account of the unavoidable decrease in Chinese farmers' income from low productivity. They say this will