The European Union and China announced early this morning that they had reached agreement on the terms of a trade agreement between them which would lead to China’s entry into the World Trade Organization.
The end of the marathon talks, which have continued since Monday between Chief European negotiator Pascal Lamy, and Shi Guangsheng, the Chinese Trade Minister, apparently came after Chinese Premier Zhu Rongji met with Lamy for over an hour.
At issue were EU demands for a lowering of agricultural tariff barriers, and the right to acquire majority interests in telecommunications, automobile and insurance ventures with China. (See earlier article).
Both sides avoided making any comments on the status of negotiations, and the details of the agreement were not immediately announced, but, according to a BBC report, the EU agreed to drop its demands concerning telecommunications in exchange for a more rapid opening of Chinese markets.
The negotiations mark the beginning of the end of China’s 14 year campaign to join the WTO. It will also put additional pressure on members of the House of Representatives to approve Permanent Normal Trading Relationship (PNTR) legislation when they meet to consider the ratification of the agreement reached with China last November.
In a related development, Maurice Greenberg, longtime CEO of AIG, made a particularly strong statement in support of passage of the PNTR bill, saying that failure to do so “would be the greatest U.S. foreign policy mistake in the last 50 years.” While that takes in a lot of territory, including Vietnam and Iran, Greenberg’s commitment to the bill is unquestioned. His stand against attempting to isolate China, affirms the arguments of the Clinton administration and most foreign trade analysts.
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