Machinery Industry's WTO Commitments

In line with the WTO commitments, with respect to tariffs, the average tariff rate for industrial products in 2002 declined to 11.7 percent and that for mechanical products declined to 9.6 percent.

With respect to non-tariffs, all quotas and other measures of quantitative restrictions for mechanical products will be eliminated by 2005. During the transitional period, quotas will continue to be used by a few imported mechanical products, mainly automobile products, at a certain rate of decrease per year until they are removed completely.

China will gradually open domestic distribution sectors and grant foreigners the right to business in China and the right to foreign trade within three years of the WTO accession.

China will also open the distribution services related to mechanical products, including commission agents' services, wholesale trade services, retailing services and franchising services, and after sales services. On the other hand, the restrictions on regions, quantities and equity interests for foreign investors to set up distribution enterprises will be eliminated gradually and the tendering requirements on non-government procurement will be removed.

In addition, the supports that the government provides after the accession will be limited to the scope of only adjusting foreign exchange rate and export rebate. The patents from the west developed countries, when used by China's machinery industry, must be paid for the license of the patent. The Government will promptly issue laws, regulations, judicial decisions and administrative rulings for general recourses related to imports and exports so as to enhance the transparency of trade policies.