-At a press conference during the Third Session of the Ninth NPC, Minister of Foreign Trade and Economic Cooperation Shi Guangsheng said China will adopt a series of preferential policies to encourage foreign investment in central and western regions. The United States has promised to grant the permanent trade most-favored-nation treatment to China. The missing of this opportunity suggests that the United States will lose the tremendous Chinese market.

At the press conference, Minister Shi answered questions on China' s entry to the WTO and the foreign trade work.

On the development of China' s foreign trade, Shi said in the latter half of last year China' s foreign trade export reversed the trend of decline and began to pick up. According to the customs statistics, last year China' s import and export volume totaled US$360.6 billion, a rise of 11.3 percent on the previous year. The export volume rose by 6.1 percent to US$194.9 billion, while the import volume grew by 18.2 percent to US$165.7 billion, creating a trade surplus of US$29.1 billion. According to the latest statistics of the WTO, China came ninth worldwide last year in terms of the total import and export volume. In the first two months of this year, China's import and export volume totaled US$60.3 billion, up 47.1 percent on last year' s same period.

On the question of how to attract foreign investment in implementing the strategy of the Large-scale development of the western region, Shi said in implementing the strategy the State will adopt a series of preferential policies to encourage foreign investment in central and western regions. The measures adopted by the State include selecting advantageous industries and projects in the western region and formulating industrial catalog guiding foreign investment. Projects in the catalog enjoy preferential policies granted to items encouraged by the State in the Industrial Catalog Guiding Foreign Investment. Foreign-funded enterprises in the category encouraged by the State in the western region may enjoy a reduced 15-percent enterprise income tax in the three years following the expiration of the existing preferential taxation policies. Foreign-funded reinvestment projects in the west with foreign investment exceeding 25 percent enjoy treatments granted to foreign-funded enterprises. Open areas and projects launched on a trial basis in the eastern area can be launched simultaneously in central and western regions. Foreign-funded enterprises in the eastern area are permitted to contract for, operate and manage foreign- and domestic-funded enterprises in the western region. Economic and technological development zones in provincial, municipal and autonomous regional capitals in the west can be upgraded to State-level economic and technological development zones upon approval. In accordance with the development of the situation, the Government will formulate some policies and measures to encourage foreign investment in the west to expedite the development of central and western regions.

On the question of what impacts will China' s WTO accession bring to the economies of Hong Kong and Macao, Shi said China's WTO accession is more conducive to the economic and trade exchanges between the mainland and Hong Kong and Macao. Hong Kong and Macao carry out trade with the mainland according to the principle of "one country, two systems' , . The trade relationship between China and the two regions is one between China and different independent tariff zones, with both sides carrying out diversified forms of economic and trade cooperation in a more convenient way in accordance with the rules of the WTO. After its access to the WTO, China will gain a multilateral, equal and mutually beneficial international economic and trade environment. This will greatly promote the development of China' s foreign trade and economic cooperation, which will also help spur the economic and trade relations between the mainland and Hong Kong and Macao.

On the question that the US Congress may refuse to grant the permanent trade most-favored-nation treatment to China, Shi said we don't wish to see the US Congress fail to solve the problem, as the mutual granting of the permanent trade MFN treatment is required by the WTO non-discrimination principle. China and the United States reached a bilateral agreement last November. It is a win-win mutually beneficial agreement and a neat one without any additional conditions. To grant China the permanent trade MFN treatment is the basis and precondition for implementing Sino-US bilateral agreements, including the Sino-US agricultural agreement, and it is also a commitment of the US side. The missing of this opportunity suggests that the United States will lose the tremendous Chinese market and give this chance to its opponents for nothing. The United States, particularly American enterprises, will become the largest loss-maker. As President Clinton said if the United States miss this chance, it will spend the next 20 years, or a whole era, regretting it.

When asked if China has made a timetable for its WTO accession, Shi said at present, the process of negotiations on China's WTO accession is being accelerated. Of the 135 WTO members, 37 requested to conduct bilateral negotiations with China, and China has signed agreements with 27 of them. As for the remaining 10 members, including the EU, China has concluded talks or will soon end negotiations with most of them and sign agreements.

On the progress of the negotiations between China and the EU, Shi said China has attached high importance to negotiations with the EU. Over the past couple of months, the two sides have speeded up the process of negotiations, carrying out two rounds of negotiations in Brussels and Beijing, with important progress. Except for contents that China will not make commitment to any WTO members, there are few questions left between the two sides. During the new round of bilateral talks on March 27 in Beijing, China expects to reach agreement and end negotiations as quickly as possible in line with the principles of equal consultation, mutual understanding and mutual accommodation.

On the question of how to assess the advantages and disadvantages of China' s WTO accession, Shi said there are both advantages and disadvantages. But, in general, the advantages outweigh the disadvantages. First, China can acquire a multilateral equal and mutually beneficial trade environment under the WTO non-discrimination principle. Second, China can play a constructive role in the establishment of a new international economic order and protect its national interests through active participation in the new round of talks. Third, China's WTO accession will promote the country's reform and opening-up and expedite the establishment and improvement of a socialist market economic structure. Fourth, China can use the WTO dispute settlement mechanism to equally resolve and handle economic and trade disputes among WTO members. Shi admitted that China' s WTO accession would bring about new challenges and pressures, particularly buffets to small enterprises with backward technologies and low management level. He said China has made sufficient preparations to meet the challenge.

On the question of how to redress contents in China' s foreign trade and economic cooperation system that are incompatible with the requirements of the WTO, Shi said after China joins the WTO, it will seriously implement the rules of the WTO and fulfill its commitments. For this, China will make amendments to its laws, regulations and policies that do not conform to the rules of the WTO. Currently, efforts are being made to sort out the contents in existing laws, regulations and policies that are incompatible with WTO rules. This will enable us to make amendments and supplements in accordance with China's legal procedures upon our WTO accession. During the course to amend and complete the existing laws, regulation and policies, we will, on the one hand, further expand opening and implement the rules of the WTO and, on the other, we will make the best of these rules to protect our country' s economic security.

Shi also answered questions on the economic and trade relations between the mainland and Taiwan and the management of processing trade enterprises.