Accession to WTO in 2001 Made the Essay

Download this Essay in word format (.doc)

Note: Sample below may appear distorted but all corresponding word document files contain proper formatting

Excerpt from Essay:

Accession to WTO in 2001, made the China baking industry open to the global competition given in the time frame of 5 years. Chinese banks were notorious for their mounting non-performing loans and low efficiency. Even though Chinese banking industry was injected with procedural reforms and regulatory amendments still it was faced with state ownership dominance and monopolistic controls. Therefore the concern facing the banking industry of China was what measures to be adopted for increasing the efficiency of banking industry most importantly the state owned commercial banks that covers the largest share of the market [footnoteRef:1]. [1: CBRC, 'The Non-performing Loan of Major Commercial Banks in China' [2009] 3 accessed 19 March 19, 2011]

Since U.S. financial industry is one of the leading in the global market therefore it can provide a guideline to the Chinese emerging banking industry in their way of restructuring and reformation of financial industry. The backbone of any financial industry is the banking sector therefore strengthening the banking industry mean flourishing the financial industry. For the purpose of intensification of the domestic banking industry it is important to gauge the internal environment of the country as well as scrutinizing the international elements that affect the performance of the domestic industry[footnoteRef:2]. Comparison between U.S. And China banking industry can give us some insight regarding the strategies for the development financial power. [2: RWolfrum and P. Stoll and M. Koebele, WTO -- trade remedies: General Agreement on Tariffs and Trade (BRILL 2008)]


The comparison made between the banking industry of U.S. And china is focused broadly on three parameters namely comparison of goals, comparison of modes and comparison of results.


Attaining the financial liberalization and collective welfare of the economy are the two core goals of the financial industry. Developing economies are in search for attracting investment for their economic development whereas developed economies who are rich in capital are seeking a profitable investment even in the developing economies. The imbalance of financial power is the decisive factor for financial liberalization. Signing of the agreement has not significantly impacted the U.S. financial market however it has created opportunities through multi-trade agreement to trade in countries with limited barriers. The consequent effect of openness agreement has transformed the Chinese banking industry from planed economy to market-based economy[footnoteRef:3] . Chinese economy does have some powerful players in the banking sector but the government's unwelcomed intervention with policy regulation has prohibited the growth of the banking sector. Therefore international competition in the banking industry will give a boost in term of operational efficiency and effectiveness[footnoteRef:4]. [3: CBRC, 'The Non-performing Loan of Major Commercial Banks in China' [2009] 3 accessed 19 March 19, 2011] [4: K. Gupta, World Trade Organisation Volume 2: Exceptions to the Agreement (Atlantic Publishers & Dist 2006)]


The comparison of modes is made on the limitation of market access and limitation on the national level between U.S. And China. From the U.S. point-of-view it gives full national treatment to the foreign banks but imposes few trade barriers. This hinders the foreign banks business strategy who is planning to expand their size and market access. The financial regulation system also is not welcoming for the foreign banks and imposes various severe controls on the openness and business operations of the foreign banks[footnoteRef:5]. [5: H. Horn, The WTO case law of 2001: U.S. -- Export Restrains (Cambridge University Press 2003)]

On the other hand, china has more concentrated on the limitation of the appearance but in actually they are fewer in fact. For the stability and development of the financial system the opening up of the banks is adhered to the proper sequential process. When taken the consideration of geographic, the setting up regions is from developed area to less developed area[footnoteRef:6]. When taken the consideration of business affairs, the openness is from foreign currency business to local currency business. Administrative approval system, qualification research, licensing quantity limitations and operation regulation have also been considered for the evaluation of mode of openness and its frequency. Nevertheless, foreign banks have been assisted with sub-national treatment in terms of income tax, business coverage, loan income and pre-tax…[continue]

Cite This Essay:

"Accession To WTO In 2001 Made The" (2011, March 19) Retrieved December 9, 2016, from

"Accession To WTO In 2001 Made The" 19 March 2011. Web.9 December. 2016. <>

"Accession To WTO In 2001 Made The", 19 March 2011, Accessed.9 December. 2016,

Other Documents Pertaining To This Topic

  • WTO and Developing World Trade Organization Currently

    WTO and Developing World World Trade Organization currently does not have a clear definition of a developing country. For this paper, we need to know what a developing country is in order to see if accession to WTO actually improves their economic situation and to see if they are treated fairly by the organization and its wealthier members. But we need to understand that since there is no clear definition of

  • WTO as the Worldwide Economic Crisis of

    WTO As the worldwide economic crisis of 2008 demonstrated, the economies of governments the world over are highly interdependent. Within this context, the World Trade Organization is coming under closer scrutiny. Negotiations are repeatedly failing and governments continue to violate commitments under WTO agreements with a dispute resolution process many countries find unsatisfactory. This paper reviews both the theoretical and practical economic and political implications of the faltering -yet ongoing -DOHA

  • China and the WTO the Impact of Becoming a Member of the WTO

    Decontamination Plan China and WTO -- the Impact of Becoming a Member of WTO In 2001, China became one of the last countries to join the World Trade Organization (WTO). In accordance with WTO rules, which will ensure the integration of China into the world economy in addition to offering a more predictable environment for trade and foreign investment, China equally agreed to undertake a series of significant commitments that will not

  • Accession to the World Trade Organization in

    accession to the World Trade Organization in 2001, China's laws regarding intellectual property rights were largely weak and ineffective, even though there were some laws on the books that were designed to protect these rights. Much of this ineffectiveness is attributed to the state-controlled economy that was in place that made observation and respect for domestic and international intellectual property rights dispensable. In its efforts to accede to the

  • Russia and the WTO Membership

    Lissovilik and Lissovilik find that Russian membership in the WTO would have a major impact on the structure and possibly the level of trade may be quite significant and could be much higher than current estimates. They find that on average, Russia's exports to WTO countries underperformed its exports to other countries in 1995-2002, all the more surprising given "Russia's trade reorientation toward the more advanced developed and developing

  • China Entry Into WTO

    China's accession to the World Trade Organization for China and its trading partners with a focus on the United States. Findings indicate that China will benefit from new export markets and increased foreign investment. The main efficiency gains from WTO membership for China will be in the protected and non-traded sectors, which will feel the impact of import competition or the arrival of new foreign-backed competitors. China's market access commitments

  • China and the World Trade Organization on

    China and the World Trade Organization On December 11, 2001, China officially became a member of the World Trade Organization (WTO), opening the country's doors to change and a new economy. One year after china's entry into the WTO, the country reported great success, showing better-than-expected economic growth and fulfillment of its WTO commitments, despite the shaky world economy. The excellent performance of the Chinese economy was clearly demonstrated by its 8% growth

Read Full Essay
Copyright 2016 . All Rights Reserved