China's Trade Disputes
China’s Trade Disputes
Disputes over protection of Intellectual Property
Complainant: United States
Respondent: China
Before China joined the GATT (General Agreement on Tariffs and Trade) in 1986, it was a planned economy. What that does mean? It means that the government was in charge of the production, investment and prices. In other words, the government was in charge of running the economy. By that time, China almost had no international commerce but only with socialist countries such as the former USSR and Yugoslavia. It was not until 1992, that China began to lower its tariffs. As a result of that, China began to grow steadily and in 2001 China joined the WTO (World Trade Organization). According to Professor David W. Conkling and Danielle Cadieux (China’s Trade Disputes, Richard Ivey School of Business, The University of Western Ontario, 2009) China had a 42.9% tariff rate in 1992; 16.6% in 2001 and since then it has been around 9.8%. These figures show how China the decreased its tariff rates since 1992 to the present. According to the WTO (World Trade Organization), the average Chinese tariff rate in 2011 was 9.6%.1 China joining the WTO2 had its own repercussions; on one hand, it was a new market with a rapidly growing population, which was attractive for many international investors. On the other hand, China’s export increased extremely fast, this rapid growth affected many industries in advanced economies. What is the reason behind this outcome? There were several issues regarding China’s commerce policies that caused a stream of trade disputes between China and other economies3.
In spite of having the Trade Related Aspects of Intellectual Property Rights (TRIPs), many Chinese producers were accused of piracy and counterfeiting. The purpose of the TRIPs4 was to provide protection in the wide area of intellectual property. However, that was not the case in China; even though, the Chinese government based its Intellectual Property Rights on U.S.
Disputes over protection of Intellectual Property
Complainant: United States
Respondent: China
Before China joined the GATT (General Agreement on Tariffs and Trade) in 1986, it was a planned economy. What that does mean? It means that the government was in charge of the production, investment and prices. In other words, the government was in charge of running the economy. By that time, China almost had no international commerce but only with socialist countries such as the former USSR and Yugoslavia. It was not until 1992, that China began to lower its tariffs. As a result of that, China began to grow steadily and in 2001 China joined the WTO (World Trade Organization). According to Professor David W. Conkling and Danielle Cadieux (China’s Trade Disputes, Richard Ivey School of Business, The University of Western Ontario, 2009) China had a 42.9% tariff rate in 1992; 16.6% in 2001 and since then it has been around 9.8%. These figures show how China the decreased its tariff rates since 1992 to the present. According to the WTO (World Trade Organization), the average Chinese tariff rate in 2011 was 9.6%.1 China joining the WTO2 had its own repercussions; on one hand, it was a new market with a rapidly growing population, which was attractive for many international investors. On the other hand, China’s export increased extremely fast, this rapid growth affected many industries in advanced economies. What is the reason behind this outcome? There were several issues regarding China’s commerce policies that caused a stream of trade disputes between China and other economies3.
In spite of having the Trade Related Aspects of Intellectual Property Rights (TRIPs), many Chinese producers were accused of piracy and counterfeiting. The purpose of the TRIPs4 was to provide protection in the wide area of intellectual property. However, that was not the case in China; even though, the Chinese government based its Intellectual Property Rights on U.S.