Fact Sheet

U.S.-China Joint Commission on Commerce and Trade

A Quarter Century of Progress

This year marks the 25th anniversary of the U.S.-China Joint Commission on Commerce and Trade (JCCT) established in 1983. Over the past 25 years, the JCCT, a government-to-government consultative mechanism for resolving trade concerns and pursuing bilateral commercial opportunities, has proven to be a useful forum for engagement and has delivered meaningful results for American businesses, workers, and farmers. Perhaps most importantly, the 19 meetings of the JCCT since 1983 have ensured the regular interaction of U.S. and Chinese senior economic and trade officials, and those relationships have improved both countries’ abilities to address trade-related misunderstandings and problems.

Bilateral engagement through the JCCT has contributed to the dramatic growth of U.S.-China trade, which has increased by nearly 85-fold since 1983, from approximately $5 billion to $387 billion. U.S. exports to China grew from $2.2 billion in 1983 to $65 billion in 2007. Top U.S. exports to China in 1983 included machinery and transportation equipment, food and live animals, chemicals, manufactured goods, and mineral fuels and lubricants, compared to top U.S. exports in 2007 of semiconductors, civilian aircraft, soybeans, plastic materials, and industrial machines.

In addition to addressing bilateral trade issues, the JCCT has sponsored a number of cooperative programs that have contributed significantly to the progress of U.S.-China commercial relations. Some highlights include:

• During the first JCCT in 1983, launched by then-U.S. Commerce Secretary Malcolm Baldrige and then-Chinese Minister of Foreign Economic Relations and Trade Chen Muhua, China agreed to negotiate an Industrial and Technological Cooperation Accord to encourage cooperation in the development of specific major projects and industry sectors in China. The agreement was signed by the late President Reagan and late Premier Zhao Ziyang in 1984. At subsequent JCCT sessions, several implementing work programs were signed in areas including industrial renovation, telecommunications, electronics, aerospace, metallurgy, machine building, and medical devices. For the next several years, China and the United States continued to meet yearly and advance trade promotion in these sectors.
• In 1992, the seventh session of the JCCT was convened in Beijing after a four-year hiatus.
• In 1994, both sides signed the Joint Statement of JCCT Working Groups, under which working groups were established in the areas of information, energy, transportation, services trade, chemicals, environment, and statistics. Both sides also agreed to resume the U.S.-China commercial law seminars, which were suspended in 1989.
• In 1995, under the JCCT, the United States and China established the Pharmaceuticals and Medical Devices JCCT Subgroup. Since 1995, in addition to regular Subgroup meetings on trade-related issues, U.S. and Chinese Government and industry experts conducted nearly 20 regulatory information exchange programs on pharmaceutical and medical device regulatory requirements. From 1997 to 2007, U.S. pharmaceuticals exports to China quadrupled from $3.7 billion to $15.5 billion while U.S. medical device exports to China more than sextupled from $145 million to $901 million.
• In 2002, under the JCCT, the United States and China held the first Insurance Dialogue between U.S. industry and the China Insurance Regulatory Commission (CIRC) as China implemented its WTO insurance liberalization commitments. As a result of the 2002 JCCT Insurance Dialogue, CIRC substantially lowered China’s high initial capitalization requirements and brought them into line with international practice by 2004.
• In 2004, under the JCCT, China agreed to suspend indefinitely its proposed implementation of the Wireless Local Area Network (WLAN) Authentication and Privacy Infrastructure (WAPI) as a mandatory wireless encryption standard. If these results had not been achieved, foreign ICT companies would have been required to form joint ventures with one of 24 identified Chinese firms and would not have been allowed to do business on their own in China.
• In 2006, under the JCCT, China committed to commence formal negotiations to join the Government Procurement Agreement (GPA) and submit its GPA offer no later than December 2007. China fulfilled that commitment, and formal negotiations are underway. Also in 2006, under the JCCT, the Chinese government required the pre-loading of legal operating system software on all computers produced or imported into China and required government agencies to purchase computers with pre-loaded legitimate software.
• In 2007, the United States and China signed a Memorandum of Understanding (MOU) to facilitate outbound tourist group travel from China to the United States to open China’s growing market to the U.S. travel and tourism industry. The first tour group traveling under this MOU was welcomed to the United States in June 2008. Average per visitor spending in 2006 by Chinese citizens traveling to the United States was more than $6,000. According to the UN World Tourism Organization (UNWTO), China will become by 2020 the world’s fourth largest source of tourists.