Before and After the Crisis
Chapter 14: China's accession to the WTO and its impact on ASEAN countries
14. China’s accession to the WTO and its impact on ASEAN countries A new development, which could pose a serious challenge to the ASEAN countries’ future economic progress and security, is the membership of China in the World Trade Organization (WTO). As discussed in the preceding chapters, exports and inward foreign capital have been the ASEAN countries’ engines of growth and economic development. For the past three decades they have achieved remarkable economic and social progress largely due to their successful export-oriented and pro-foreign investment policies, which was only interrupted by occasional economic crises: one was in 1985 and most recently in 1997 and 1998. Political considerations aside, the admission of China into the WTO will certainly have some positive implications for the world economy as it offers a large market potential and would generally provide stability and predictability with China, who will be bound by the same rules, opening up vast opportunities for market niches. But at the same time its membership has also raised serious concern for those developing countries whose export structures are similar to China’s. The ASEAN countries in particular are concerned about its likely negative impact on their export and growth potentials. To what extent are their exports competitive or complementary? In which commodities are they likely to compete? What implications will China’s WTO membership have for their exports and inward foreign investments? In view of the membership of China in the WTO and the ASEAN serious concern about its trade and investment impacts, the...
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