CHINA LIKELY TO JOIN GATT, DIPLOMATS SAY
China is likely to succeed in joining
GATT despite policies that contradict free trade, because
western countries support its entry, western diplomats said.
    China applied to join the General Agreement on Tariffs and
Trade (GATT) in July 1986. The organisation, formed in 1948 to
integrate the world's free market economies, now regulates 80
pct of world trade.
    The GATT secretariat is expected to submit a list of
detailed questions to China next month at the start of long and
complex entry negotiations, the diplomats said.
    One diplomat said China's prospects are good, with its
application supported by the United States, Japan and the
European Community for political and economic reasons.
    "The fear is that if China was refused entry, it would draw
back the bamboo curtain and go back to the way it was," he said.
    Another said the Soviet Union was waiting in the wings.
    "If GATT accepted China, it would be hard not to accept the
Soviet Union," he said. "China's agreement will be seen as a
model for the Soviet Union. GATT is not a political body."
    But serious problems have to be tackled during the talks,
including China's pricing system and trade subsidies.
    GATT is based on free trade and aims to lower tariffs and
promote trade, with prices alone dictating who buys what.
    One diplomat said it was very hard in China to establish
the real cost of goods because many prices are set by the state
and often contain subsidies.
 Reuter
