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China Market Economy Status

By June 13, 2016 No Comments

Mr. Felipe Hess, permanent representative of Brazil before the World Trade Organization (WTO) stated that China might access the dispute settlement system of WTO to claim its right to be recognized as a market economy by its members.

China became a member of the World Trade Organization (WTO) on December 11, 2001, in order to better participate in the world economy. In this occasion, the Chinese government agreed to a series of important commitments to open and liberalize the Chinese economy, the Chinese Accession Protocol.

This Protocol, however, is due on September 2016. By that time, China must have accomplished all the steps disposed in the Protocol and, as a consequence, it will be granted the Market Economy Status (MES).

Even though China is a great commercial partner of Brazil, the country has not yet decided whether it will recognize China as a MES. It is important remember that, in 2004, Brazil and China signed a Memorandum of Agreement on which Brazil recognizes China as a Market Economy. The agreement, however, still requires the approval of the Ministerial Chamber of Foreign Trade to enter into force.

According to Mr. Hess, Brazil should timely look for a weighted solution regarding the Chinese status. Mr. Hees advocates that China has a particular economic setting, and, therefore, cannot be easily labeled. For that reason, in his perception, Brazil should further analyze the consequences of grating china MES as well as creating a specific mechanism to analyze antidumping on Chinese imports.

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