China on the verge of inclusion in the WTO
The upcoming WTO conference scheduled for November 9-13 in Doha, Qatar, is almost certain to mark China’s entry to the WTO, ushering a much anticipated adjustment period where China begins to open its markets to Canadian and other exporters.
Additionally, Chinese goods will be more competitive in global markets. The promise for Canadian companies is lowered direct costs and the elimination of many of the hidden costs and red tape currently associated with doing business in China.
With its low cost labor and 1.3 billion people eager for Western products, many observers believe that China is the Shangri-la that North American companies who are hungry for cost-reductions and new revenue have been dreaming of. Many problems including the business infrastructure and political climate in China have to be dealt with, and the benefits of China’s entry into the WTO can vary greatly by industry. For example:
–Currently, the duties on ‘kid’s bicycles’ coming from China into Mexico total 167%. These are expected to be reduced to 23%.
–Now, ‘children’s clothing’ made in China is severely restricted by import quotas. These quota restrictions will very likely be lifted.
China is exporting $100B worth of goods per year with more than 40% going to the North American market.
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