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Wednesday, September 29, 1999 Published at 11:13 GMT 12:13 UK

Business: The Economy

China says WTO deal near

Henry Kissinger addresses US business leaders in Shanghai

China says that it is near a deal to join the World Trade Organisation.

But the United States, which is the chief obstacle to a membership agreement, says little progress has been made so far in negotiations.

[ image: Western fashion shows are now common in China]
Western fashion shows are now common in China
Chinese minister of Foreign Trade Shi Guangsheng, who met US Trade Representative Charlene Barshefsky in Washington early this week, said the talks were "constructive" and "beneficial."

China was adopting a "sincere and positive" approach to the negotiations, he added.

China's chief negotiator, Long Yongtu, was even more upbeat.

He said a deal was "very close."

"Both sides already know the negotiating positions of the other side and now we have to make some difficult decisions .. it is basically a political decision," he added.

However, the talks ended a day early. Charlene Barshefsky said that "there would be another meeting" and that there was a good chance outstanding disagreements could be resolved.

Devil in the details

China and the United States came close to deal in April which would have allowed China to join the WTO in return for concessions that would have opened up more of its markets to foreign investment and competition.

[ image: Western banks are keen to open up the financial sector]
Western banks are keen to open up the financial sector
But talks were suspended after NATO's bombing of the Chinese embassy in Belgrade. It was only at the Auckland summit two weeks ago that US President Clinton and Chinese President Jiang Zemin agreed to restart the process.

The US believed it had won concessions in April that would open key service sector markets like banking and telecommunications to full international competition.

But China says there was no agreement, and some officials have been adopting a hard line on issues like foreign Internet investment recently.

There are also difficulties on US exports of grain, and Chinese textile exports.

China wants to join the WTO before the Seattle round of world trade talks begin at the end of November.

But the delays are casting doubt whether this objective is achievable.

US Senate leader Trent Lott warned that the crowded legislative schedule could make the ratification of any agreement difficult this year.

China woos businessmen

Meanwhile, the Chinese president has been welcoming Western business leaders to China for the celebrations of the 50th Anniversary of the People's Republic.

Jiang Zemin told businessmen including Phil Condit, the head of Boeing, and Gerald Levin, the boss of Time Warner, that China wants to encourage foreign investment, and he vowed to reform the state sector.

But he made relatively few references to the trade talks, although China has announced a reform of its patent law to allow more protection of intellectual property.

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