WTO and implications for the Chinese environment policy

Abstract

Regulatory basis of trade and environment under the WTO are the provisions of the relevant WTO-Agreements. Though these Agreements are basically containing trade regulations, there are also a range of environment related provisions. With the entry into WTO, China has to follow these WTO-rules (reduction of WTO incompatible subsidies especially in the energy, textile and agricultural sector, opening of the domestic markets etc.). As a consequence, there could be negative effects on employment, e.g. in the agricultural sector. However, entering the WTO, China also receives the right to use the trade conflict settlement mechanisms of the organization including environment related cases as other developing countries did before. Implementing the WTO-rules could also bring about economic and environmental benefits for China. Benefits especially come up from the reduction of the over-utilisation of natural resources though the lift of subsidies and from the promotion of environmentally friendly technology, inter alia through WTO consistent governmental support including tax reductions. As a developing country, China also has the right to utilise the relevant WTO exemptions for import liberalisation.