China Joins the World Trade Organization

Fifteen Years of Negotiation

China began seeking membership in the General Agreement on Tariffs and Trade (GATT) and its successor, the World Trade Organization, in 1986. Negotiations stretched over fifteen years, complicated by debates over whether China should be treated as a developing or developed economy, concerns about state subsidies and market access, and the political rupture following the Tiananmen crackdown of 1989. The accession process required China to commit to opening its markets, reducing tariffs, and accepting external adjudication of trade disputes.

Accession

China formally joined the WTO on December 11, 2001, at the Fourth Ministerial Conference in Doha. Accession commitments included reducing average tariffs from 15.3 to 9.9 percent, opening financial services and telecommunications to foreign competition, and accepting review mechanisms for trade practices. The agreement was the largest and most complex accession in WTO history, running to hundreds of pages of specific commitments.

Economic Consequences

The effects on China's economy were transformative. Export growth accelerated dramatically, with China's share of global exports growing from roughly three percent in 2001 to thirteen percent by 2010. China became the world's largest exporter by 2009. Manufacturing investment flooded in. However, critics argued that China's state-directed industrial policies and currency management constituted unfair subsidization, grievances that eventually drove US-China trade tensions under multiple administrations and the trade confrontations of the late 2010s.