China is set to reapply to the WTO Procurement Group, according to the Wall Street Journal.

“China offered to increase foreign companies’ access to its government purchases as it seeks to overcome international complaints that it discriminates against foreign vendors, but analysts said the move still may not go far enough toward easing their concerns,”Loretta Chao wrote in a July 20 article.

Foreign investors criticized China’s government for its rules governing access to its massive government-procurement market, which prompted the new proposal. The offer, presented in the form of a new, revised proposal for membership in the WTO’s Agreement on Government Procurement (GPA), which requires nondiscriminatory access to government purchases, follows an initial proposal that was rejected in 2007.

Though the U.S. and other WTO members rejected China’s first proposal, China’s current offer addresses a number of complaints about the 2007 proposal. “It reduces a requested transition period for implementing the agreement to five years from 15 years, for example, and also adds 15 more central-government agencies whose purchases are covered by the agreement.”

Foreign business investors, however, say the proposal still apparently falls short of their requirements on several accounts. For example, the proposal does not cover state-owned enterprises and agencies under provincial or local governments, even though state-owned enterprises include many of China’s biggest companies and those agencies make up a significant portion of government spending in China.

Without the coverage of state enterprises and lower-level agencies “no one will be willing to accept China’s accession into the GPA,” said Stephen Kho, senior counsel at Akin Gump Strauss Hauer & Feld LLP in Washington. “Having a better offer than before will help assuage some concerns, but that won’t be enough.”

Mr. Yao Jian, a China Commerce Ministry spokesman, hopes other members will take into account that China is still developing its economy and that they currently face a bottleneck in market opportunities in the U.S., Europe and other overseas markets because of China’s lack of membership.

So, essentially what is happening is China wishes to reapply and join because it wants access to bid on businesses in the U.S. and EU. Western companies wish to be able to bid in China for business, but China is not willing to open access to the large state-owned enterprises.

So what is the lesson to take away from this? The WTO should be disbanded. Until the countries involved all want free and fair trade, the WTO causes far more harm than good. Any trade handled between countries should be negotiated individually, amongst themselves. It is the only way to currently guarantee fair and free trade.

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