The Fourth Informal Leadership Meeting of the Asia-Pacific Economic Cooperation (APEC) forum ended on November 25 in Subic Bay, the Philippines, with the adoption of a Manila Action Plan and a leaders' declaration. Attended by leaders from its 18 members, including Chinese President Jiang Zemin, the meeting focused on further promoting economic and trade cooperation among APEC members and boosting economic development in the region.
Since its inception in 1993, APEC has called three informal summit meetings. The first such meeting was held in November 1993 in Seattle, opening a new chapter in trade liberalization and economic and technological cooperation in the Asia-Pacific region.
In November 1994, the second informal summit was convened in Bogor, Indonesia, with the adoption of a momentous Bogor Declaration. That document called for trade and investment liberalization no later than 2010 on the part of developed members and by 2020 for developing ones.
In November 1995, Osaka, Japan hosted the third APEC informal summit. An Action Agenda adopted at the meeting set targets for trade liberalization in 15 areas, signifying that APEC had evolved from a mere "concept" into a reality.
China has made great strides toward trade and investment liberalization in the past year.
Since China is a major member of APEC, President Jiang has attended all four meetings, expounding on major principles for APEC and advancing proposals on economic and technological cooperation. At the Osaka summit, Jiang announced five actions the Chinese government would take in 1996 toward trade and investment liberalization, including:
Reducing import tariffs on more than 4,000 items by at least 30 percent;
Lifting tariff quotas and import control measures on another 170 types of products;
Conducting trial operations for Sino-foreign joint venture foreign-trade enterprises in Shanghai and elsewhere;
Continuing to expand trial operation of Sino-foreign joint venture retail enterprises; and
Integrating the foreign exchange market for foreign-invested enterprises into the comprehensive system of exchange settlement by Chinese banks.
This agenda not only demonstrates China's determination to stick to the reform and opening policy, but also suggests that the country is actively helping shape APEC operations. The international community responded positively to the initiatives.
The five steps came as an inevitable outcome of China's domestic development and the reform of its foreign trade structure. Throughout the past year important steps toward accomplishing these goals have been made.
Starting from January 1, China has lifted import quotas and licenses for 176 tariff items, including car bodies, photo copiers, air conditioners and chemical products. In addition, it has significantly simplified import administration and increased market access to foreign goods. Currently, the country maintains import quotas and licenses on only 384 tariff items, or a 95 percent import liberalization ratio.
Starting from April 1, import duties on more than 4,900 tariff items have been significantly lowered, and the average tariff level dropped from 35.9 percent to 23 percent, or a reduction of 36 percent. That reduction was ahead of the target set at the Uruguay Round of the General Agreement on Tariffs and Trade under which members would lower their tariffs by one third within five years. In fact, while enforcing the reductions, China more than fulfilled the promise it made in Osaka in terms of both the number of items lowered and the scale of reductions.
Starting from July 1, the State Council announced that foreign exchange trading by Sino-foreign joint ventures, Sino-foreign joint cooperative enterprises and solely foreign-owned companies would be incorporated into the foreign exchange settlement and trading system of banks, and that by the year's end the Renminbi (RMB) would be convertible in current accounts. This measure will facilitate the formation of a unified national foreign exchange market and the exchange rate of the RMB, a critical prerequisite for China to join the world economy.
In September the State Council approved a plan to include Shenzhen as a pilot city much like Shanghai for setting up foreign trade companies with Chinese and foreign partners. Subsequently, the Chinese government announced guidelines for such companies. Prior to the approval, the State Council delegated more power to provinces, municipalities and autonomous regions for approving foreign-investment projects under US$30 million. Previously, they were allowed to approve projects under US$10 million only.
At the Subic summit, China set its timetable for more steps to be taken in the areas of tariff, non-tariff, service trade and investment in the near, medium and long terms. The realization of those goals will not only promote the opening and prosperity of the Chinese economy but will also contribute to the prosperity of the Asian-Pacific region. |