Wang Xiaolong: China is ‘willing to play by the rulebook’

Ambassador Wang Xiaolong addresses this year’s China Business Summit. Photo / Supplied

OPINION:

First, why did China apply to join the CPTPP?

China’s application to join the CPTPP (Comprehensive and Progressive Trans Pacific Partnership) is a serious one. President Xi has stated on many international occasions that China will actively work toward joining the CPTPP, fully demonstrating China’s firm political commitment.

China’s application to the CPTPP is also a decision made by the Chinese government based on its own development strategy, not a decision of convenience.

The CPTPP represents the “gold standard” of regional economic and trade rules, and its high-standard rules are consistent with the direction of China’s further reform and opening up. While expanding its openness to the outside world, China is also accelerating the pace of domestic reform. CPTPP will form a critical piece in China’s high-level free trade agreement (FTA) network as the country expands high-standard opening up.

I’m glad that China’s application has been welcomed and supported by many New Zealand friends. Some pointed out that “there can be little doubt that the Chinese application is a serious one and not, as some would have it, a manoeuvre to throw a spanner in CPTPP’s works”. This is a correct interpretation that I would like to acknowledge.

Xi Jinping. Photo / Nathan McKinnon

Second, Is China able to meet the CPTPP’s high standards?

There is scepticism that China cannot meet the high standards of the CPTPP. That is unwarranted.

In fact, the Chinese government has conducted several rounds of in-depth research and evaluation of more than 2300 articles of the CPTPP, and sorted out the reform measures and laws and regulations that need to be modified for China’s accession to the CPTPP. The country is ready to play by the CPTPP rulebook.

Before I came to New Zealand, I was personally involved in that evaluation work in Beijing. Recently, the Chinese government has submitted an exchange document for its accession to the CPTPP and on that basis will provide its answers to the CPTPP questionnaire.

In the meantime, China has been running a stress test and has implemented the first trial of reform and opening-up in CPTPP-related rules.

In late June, China issued a set of measures which will be introduced on a trial basis in some of the country’s free trade pilot zones and the Hainan Free Trade Port. The measures encompass 33 items, such as ensuring equal treatment for both domestic and foreign financial institutions, prohibiting the requirement of transferring or acquiring software source code as a condition for the importation and sale of mass-market software, etc. It is expected that the measures will be rolled out in other areas nationwide in the future. This is strong evidence, among others, that China is capable of fulfilling its obligations under the CPTPP.

What are the benefits of China’s accession to the CPTPP?

I trust China’s accession will bring benefits to New Zealand and all the other CPTPP members. As the world’s second-largest economy, China currently has a 400 million strong middle-income community, which is expected to double to 800 million by 2035, bringing about a super-sized market open for the whole world.

The Peterson Institute for International Economics estimates that Chinese membership in the CPTPP will quadruple the global income gains.

For New Zealand, China’s accession to the CPTPP will build on our bilateral FTA, adding new market access. With the commitment to the CPTPP high-standard environmental rules and digital rules, there will be opportunities for us to co-operate in green technologies, low-carbon products and digital products.

It is worth mentioning that with Chinese membership, the CPTPP will become a more lucrative pact and be more attractive to other economies, which will bring in more businesses for New Zealand.

In the Joint Statement between New Zealand and China on the Comprehensive Strategic Partnership, New Zealand welcomed China’s application to join the CPTPP. I wish to extend our appreciation to the New Zealand Government.

CPTPP is a newly emerging trade architecture in the Asia-Pacific region. China, like New Zealand, a faithful and exemplary actor in regional co-operation, is both willing and capable of joining the CPTPP.

I sincerely hope New Zealand will support and facilitate China’s accession to the CPTPP in this year’s chairmanship and I hope China will receive support from friends of all sectors. I look forward to the establishment of an Accession Working Group for China at an early stage, to promote integrated development of the region and elevate our win-win co-operation to a new height.

Wang Xiaolong is China’s ambassador to New Zealand