MNI INTERVIEW2: China Could Drop WTO Developing Status-Advisor

China could agree to forgo its developing-country trade status in the World Trade Organization and accelerate the reform and opening of its economy if a future Joe Biden presidency engages with Beijing, a former advisor to China's central bank said in an interview.

Now the world's second-largest economy, China should not cling to special terms set 20 years ago and meant only as a transitional arrangement, Huang Yiping, a former member of the Monetary Policy Committee at the People's Bank of China, told MNI.

If a future President Biden observes international rules and operates in a spirit of multilateralism, China would be willing to advance negotiations, he said.

"If we can sit down on the WTO platform and talk about what each side should do, how to make the changes, I think China will find it much more acceptable," Huang said.

CONCERNS

But Huang acknowledged concerns in Beijing that a Democratic Party U.S. administration may pursue a more ideological agenda on matters such as human rights. A Biden administration may also seek to unite western powers and other allies to intensify pressure on China, in order to push it to cut subsidies to the state-owned companies, boost intellectual property protection, and open its service sector and digital economy.

"My feeling is that no matter what, Biden assuming power is likely a good thing, for, most importantly, he believes in rules," Huang said.

If China were to give up developing nation status on its own initiative it would not only demonstrate a commitment to multilateralism, but also help spur the country's development, Huang said. The status reduces incentives for changing outdated industries and distorts policies towards both domestic and global markets, he said.

Since China has long promised it would continue to reform these areas, it is time to live up to its "big-nation economy" status, Huang said.

Huang agreed with other Chinese policy advisors that a Biden presidency could present an opportunity to renegotiate the Phase One deal agreed with the Trump administration, in order to change terms China regards as unreasonable, such as commitments to meet targets for purchasing U.S. products.