ISA Manzanillo 1997: EU and Greater China

ISA Manzanillo 1997: EU and Greater China

"The EU, the Greater China Area and Globalization:

The Case of the International Trade Regime"

by

Finn LAURSEN

With the assistance of Berenice Lara-Laursen

The Thorkil Kristensen Institute

South Jutland University Centre

Niels Bohrs Vej 9

DK 6700 Esbjerg

Denmark

From Introduction:

The concept of the Greater China Area is not well defined. In this paper we use it to refer to the PRC (or Mainland China), the ROC (or Taiwan), as well as Hong Kong that returned to Chinese sovereignty in July 1997, and Macao which will return to Chinese sovereignty in 1999. The latter two are already members of the WTO.

The other unit dealt with in this paper is the European Union (EU), which has had a Common Commercial Policy (CCP) for a number of years and which is supposed to have a Common Foreign and Security Policy (CFSP) since the entry into force of the Maastricht Treaty on European Union in 1993. We mention the latter because the question of PRC and ROC accession to the WTO is partly economic and partly political. However, the political question of diplomatic recognition was solved by the member states before the entry into force of the Maastricht Treaty.

The purpose of the paper is to outline the EU commercial policy via-รก-vis the PRC and ROC, especially concerning membership of the WTO. Since joining the multilateral trade regime usually involves the negotiation of an accession ticket the EU has had to develop a policy on the controversial issues associated with PRC and ROC membership first of GATT, then WTO.

The issues have to be seen in the context of growing trade between the EU and East-Asia in general, the Greater China Area in particular. The fact that the EU has trade deficits with China and Taiwan - although not with Hong Kong - is part of this context. In the political contest between the PRC and ROC all members states of the EU now have diplomatic relations with the PRC but not with the ROC. The EU has accepted that there is only one China and that the PRC represents that China. There are only informal relations with Taiwan even if Taiwan is an important trading partner of the EU.

Paper prepared for delivery at ISA-AMEI Conference, Manzanillo, Mexico, December 11-13, 1997.

Dr. Finn Laursen