[EDITORIALS]Get Ready for a Different ChinaWashington and Beijing announced Saturday an agreement on issues that have blocked China's entry into the World Trade Organization. Unless there are some unusual events, China is expected to become a member of the WTO by November. China's membership in the WTO will have a significant impact on the world economy, considering its population of 1.3 billion and huge market potential.
If China's tariffs are lowered and its procedure of resolving trade conflicts is revised to meet international standards, Korea will gain easier access to the Chinese market. This could be an opportunity for Korea to be better positioned in areas where it is competitive, such as the telecommunications. The Korea International Trade Association predicted Sunday that China's entry into the WTO would contribute to increasing Korea's exports to China by about $ 460 million per year.
But there also will be negative impacts. For one thing, the duration of the export increase is uncertain. Leading companies from all over the world will jump into the battle for the Chinese market, and already here and there in the world, Korean products are being replaced by Chinese goods, indicating Chinese products' competitiveness. Attracting foreign capital is what we have to worry about more than anything else. China already ranks third in attracting foreign capital, following the United States and the United Kingdom. If investment conditions in China are enhanced with its admission to the WTO, there is a high possibility foreign investors will turn from Korea to China, which is less competitive in labor and land costs. Cheap agricultural produce from China, such as garlic, is expected to flood the Korean market, damaging the domestic agricultural industry.
China's membership in the WTO will be a threat as much as an opportunity. Every sector of Korean society needs to cooperate to draw up measures to meet the competition, especially now, with labor and management at odds and the government and corporate sector in conflict. We must reorganize our industries, focus on products with the highest added value and target niche markets. It is time for labor and management to exert all their efforts to transform Korea into a country that offers a better business environment by restricting labor disputes and eliminating regulations.
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