published by - forsiden · 3.3.1 air transport services 56 3.3.2 maritime transport services 56...

Published by:Norwegian Ministry of Trade and Industry Additional copies may be ordered from:Government Administration ServicesPost og distribusjonE-mail: [email protected]: + 47 22 24 27 86 Publication number: K-0702 EDesign: Lysvold DesignPrinted by: Government Administration Services – 03/2008 – Impression 200

This study has been prepared by the Ministry of Trade and Industry, Norway and the Ministry of Commerce, China.

3

Contents

Executive summary 5

Chapter one: Introduction 7

1.1 Overviewofbilateraleconomicrelations 7

1.2 AnintroductionoftheeconomiesofChinaandNorway 10

1.2.1 The Chinese economy 10

1.2.2 The Norwegian economy 11

1.3 Objectivesandstructureofthestudy 13

Chapter two: Impact of trade liberalisation in goods 15

2.1 AnoverviewofChinesetradepoliciesapplyingtotradeingoods 15

2.1.1 Tariffs 15

2.1.2 Tariff quota 16

2.1.3 Rules of origin 16

2.1.4 Other aspects of trade policy 17

2.2 AnoverviewofNorwegiantradepoliciesapplyingtotradeingoods 21

2.2.1 Tariffs 21

2.2.2 Quantitative restrictions 22

2.2.3 Rules of origin 23

2.2.4 Other aspects of trade policy 26

2.3 CurrenttrendsoftradeingoodsbetweenChinaandNorway 31

2.3.1 Technology goods: machinery, electronic equipments and optical instruments 33

2.3.2 Textiles and apparel 35

2.3.3 Oil, natural gas and chemical products 37

2.3.4 Metal products; including nickel, aluminium and iron/steel,

and alloys of the before mentioned 39

2.3.5 Fish and marine products 42

2.3.6 Agriculture products 45

2.4 Overallimpactofliberalizingtradeingoods 47

I m pA C t O f t r A d e l I b e r A l I s At I O N I N g O O d s4 C O N C l u s I O N s A N d r e C O mm e N d At I O N s4

Chapter three: Impact of trade liberalisation on services 49

3.1 AnOverviewofChinesetradepoliciesApplyingtoservices 49

3.2 AnoverviewofNorwegiantradepoliciesapplyingtoservices 52

3.3 CurrenttrendsoftradeinservicesbetweenChinaandNorwayinspecificsectors 56

3.3.1 Air transport services 56

3.3.2 Maritime transport services 56

3.3.3 Energy services 58

3.3.4 Construction (and related engineering) services 59

3.3.5 Educational services 61

3.3.6 Hotels and restaurants services (including travel and tourism) 62

3.3.7 Environmental services 63

3.4 Overallimpactofliberalizingtradeinservices 63

Chapter four: Investment 65

4.1 AnoverviewofChineseinvestmentpolicyandmeasures 65

4.2 AnoverviewofNorwegianinvestmentpolicyandmeasures 68

4.2.1 Norwegian foreign portfolio investments through

the Government Pension Fund – Global 70

4.3 bilateraldirectinvestmentbetweenChinaandNorway 72

4.4 Overallimpactofliberalizinginvestment 72

Chapter five: Strengthening bilateral economic cooperation 74

5.1 tradefacilitation 74

5.2 e-commerce 77

5.3 sanitaryandphytosanitarymeasures(sps) 79

5.4 technicalregulationsandstandards(tbt) 83

5.5 Intellectualpropertyrights(Ipr) 85

5.6 smeCooperation 87

5.7 temporarymovementofnaturalpersons 89

5.8 tradeandinvestmentpromotion 91

5.9 environmentandtechnologycooperation 93

5.9.1 Environmental protection 94

5.9.2 Renewable energy exploitation 95

5.10 developmentCooperation 99

Chapter six: Conclusions and recommendations 100

6.1 KeyConclusions 100

6.2 recommendations 101

55

Executive summary

sincetheestablishmentofthetwocountries’diplomaticrelationsin1954,whichisbased

onthe“OneChina”principle,ChinaandNorway’spolitical,economicandtraderelation-

shiphasenjoyedrobusthealth.

On26march2007theChineseprimeministerWenJiabaoandtheNorwegianprime

ministerJensstoltenbergmetinbeijingandexchangedviewsonstrengtheningthe

bilateraltradeandeconomicrelationsbetweenthetwocountries.

AsanexpressionofthewillofChinaandNorwaytobuildanevenstrongereconomic

andtraderelationship,thetwocountriescommittedtoundertakeafeasibilitystudyof

apossiblefuturefreetradeAgreement(ftA)asabasisforadecisionastowhetherto

enterintoftAnegotiations.

thefeasibilitystudyshowsthat,whilebilateraltradehasgrownstronglyoverrecent

years,existingbarrierstotradecurrentlyinhibitthefullpotentialforfurthergrowthin

trade.thestudydemonstratesthatthesebarrierstakevariousformssuchastariff-and

non-tariffbarriersongoodsandregulatorymeasuresonservicesincertainsectors.

ApossibleftAbetweenChinaandNorwaywouldbeexpectedtoeliminatetariffson

substantiallyallthetradebetweenthetwocountriesandaddressingnon-tariffmeas-

ures,whiletakingintoaccountsensitivitiesonbothsides.Asaminimum,anftAshould

reducetariffsbeyondeachcountry’scommitmentsintheWorldtradeOrganization

(WtO).

thestudyhasdemonstratedthatservicesarenotonlyimportantintheeconomiesof

NorwayandChina,butalsoanimportantcomponentoftotalbilateraltrade.further

liberalisationoftradeinservicesbetweenthetwocountriesshouldbeaimedatcreating

mutualbeneficialandtailormadesolutionsforChinaandNorway.

Inrelationtoinvestment,thefutureftAbetweenChinaandNorwaywouldresultin

greatertransparencyofregulationsandlawsthataffectbothdirectandportfolioforeign

investments,moreliberalisedregimeswhichwillfacilitateinvestmentsineachcountry,

andamorestablepolicyframeworksforinvestors.

I m pA C t O f t r A d e l I b e r A l I s At I O N I N g O O d s6 C O N C l u s I O N s A N d r e C O mm e N d At I O N s66

AnftAwouldbeexpectedtointensifyfurtherbilateraltradeandeconomiccooperation,

includingintheareasoftradefacilitation,electroniccommerce,sanitaryandphytosani-

tarymeasures,technicalregulationsandstandards,intellectualpropertyrights,smalland

mediumsizebusinesscooperation,temporaryentry,tradeandinvestmentcooperation,

environmentandtechnologycooperationanddevelopmentcooperation.

Whilerecognisingthatnothinginthestudypre-judgeshowparticularissuesmightbe

addressedinthescopeofapossibleftA,bothpartiessharetheaimofcreatingasino-

Norwegianeconomicandtradeframeworkwiththeobjectivesofacceleratingsustain-

ableeconomicgrowthanddevelopment,creatingjobsandraisinglivingstandardsin

ChinaandNorway.

7

Chapter one: Introduction

1.1 Overview of bilateral economic relations

NorwayandChinaenjoyastrongandexcellentbilateralrelationship.

thefrequentexchangesofhigh-levelvisitscontributegreatlytotheexpansionofour

relationship.morethan70officialChinesedelegationsvisitedNorwayin2006.someof

themostillustriousvisitorswerepolitbureaumemberliChangchun,VicepremierZeng

peiyanandministerofCommerceboXilai.primeministerJensstoltenbergmade

asuccessfulvisittoChinainmarch2007.

duringthemorethan50yearsthatNorwayandChinahavehaddiplomaticrelations,

ourrelationshiphasgrowntoincludeanimpressiverangeofpersonalandinstitutional

contactsinalmosteverysectorofoursocieties.In2006ChinabecameNorway’smost

importanttradingpartnerinAsia.thesameyearsawtheestablishmentoftheNorwe-

gian-ChineseChamberofCommerce.forChina,Norwayisanimportanttradingpartner

inNortherneurope.tourismbothwayshasincreasedmanifoldinthelastfewyears.

In1963NorwaywasamongthefirstWesterncountrieswithwhichChinaestablished

anagreementonculturalcooperation.sincethenthecooperationbetweenourcoun-

triesinthefieldsofculture,educationandresearchhasseenasteadyincrease.Cultural

exchanges,researchcollaborationandstudentexchangeswillcontinuetoplayan

importantroleinincreasingtheinterfacebetweenNorwegianandChinesesociety

andstrengtheningbilateralcooperationinotherareas.

thisyearmarksthe10thanniversaryoftheChinese-Norwegiandialogueonhuman

rightsandtheruleoflaw.thedialoguehasbeenanimportantandpositiveadditionto

ourbilateralrelationship.formorethan10yearsourcountrieshavecollaboratedclosely

onenvironmentalissues,andwewillintensifyourcooperationonclimatechange,

renewableenergyandenergyefficiency.Otherareasofcollaborationincludetheequi-

tabledistributionofgoodsandresourcesandinternationalissuessuchaspeacekeeping

andglobalclimate,tradeanddevelopmentissues.

China’simpressivegrowthandincreasinginternationalpresenceontheworldstage

isamuch-welcomedevelopmentthatpresentsopportunitiestoallnations,including

Norway.tomeettheseopportunitiesaswellasthoseofanever-expandingbilateralrela-

tionship,theNorwegiangovernmentintroducedanewChinastrategyinAugust2007.

r e p O r t N O r WAy – C h I N A8

thestrategysetsoutNorway’saimsandprioritiesvis-à-visChina.thestrengtheningof

sino-Norwegianeconomicandtraderelationsisoneofthreemainpillarsofthisstrategy.

AsaconsequenceoftheimportanceNorwayattachestotheevolvingrelations

withChina,NorwaywillstrengthenitspresencebyopeningaConsulategeneralin

guangzhouandincreasingthestaffattheembassyinbeijing.

Trade and economic cooperation

sino-Norwegianeconomicrelationsarestrong.Increasedtradeandinvestments

betweenthetwocountries,andanincreasingnumberofeconomicagreements

betweenthetwostatesillustratethis.

bothNorwegianandChinesetradestatisticsshowthesametrend:tradeingoods

betweenChinaandNorwayisincreasing.1however,ChineseandNorwegiantrade

statisticsshowdifferentfiguresandpercentages.

basedonNorwegianstatisticstotalsino-Norwegiantrade(importsplusexports)

increasedby33%in2006comparedto2005.thevalueoftotalbilateralmerchandise

trade,importsplusexports,amountedtous$5,4billionin2006.Asubstantialincrease

ofNorwegianpetroleumexportstoChinaexplainsthisimpressivegrowth.Norway’s

exportstoChinadeclinedby6,5%inthefirstelevenmonthsof2007comparedtothe

sameperiodin2006,fromus$1,6billiontoapproximatelyus$1,5billion.thisisdueto

decreasedexportofoilsofarthisyear.

giventhatChinabuysNorwegianpetroleumonthespotmarket,therewillbevolatility

fromyeartoyearinthetradefigures.Abetterindicationofthelong-termtraderelations

isthereforetofocusontradeexcludingoilexports.excludingNorwegianoilexportsto

China,theincreasewasstillahealthy26%in2006.

ChineseexportstoNorwayin2006amountedtous$3,7billion,up17.1%from2005.

duringthefirstelevenmonthsof2007ChineseexportstoNorwaygrewby34%,

comparedtothesameperiodlastyear,andamountedtous$4,5billion.

In2006,oilconstitutedNorway’slargestexportitemtoChina(representing41%ofits

overallmerchandiseexports),followedbymachinery(15%)andfishandseafood(9,8%).

machineryandelectronicproductsrepresentedNorway’slargesimportitemsfrom

China(accountingfor17,7%and17,2%respectively),followedbywovenapparel(10,9%),

knitapparel(8,5%)andfurnitureandbedding(6,2%).

Chinesestatisticsshowthesametrends,butthepictureisquitedifferent:Norwegian

exportstoChinaincreasedby10%,fromus$1,14billiontous$1,25billionfrom2005to

2006.duringthefirstsixmonthsof2007NorwegianexportstoChinaincreasedby27,7%

1 ”trade”inthecontextofthischaptermeanstradeingoods,astherearenoreliablecountry-specificdatafortradeinservices.Asurveyofbilateraltradeinservicesiscoveredinchapterthree.

r e p O r t N O r WAy – C h I N A 9

comparedtothesameperiodin2006andreachedatotalof$us760million.Norwegian

importsincreasedby29%,fromus$1,32billiontous$1,7billionfrom2005to2006.

thefirstsixmonthsof2007importsincreasedby23,1%comparedtothesameperiodin

2006andreachedatotalof$us980million.

evenif,intheory,theimportdataofonecountryshouldbethemirrorimageofits

tradingpartner’sexportsdata,discrepanciesinmerchandisetradedataaretherule

ratherthantheexception.discrepanciesresultfromdifferencesincoverageofnational

tradestatistics,valuationsystems,partnerattributionincaseoftransittrade,classifica-

tion,timeofrecording,aswellasdifferencesinexchangesratesormethodsofcalcu-

latingtradedata.Asimplemethodtomodifythediscrepancieswouldbetousethe

importstatisticsofthetwocountriesasabasisforthedescriptionofthetraderelation-

ship.thiswouldfor2006giveatradevolumeofus$4,95billion(versustheNorwegian

figureofus$5,4andtheChineseofus$2,95billion).

AnincreasingnumberofNorwegiancompaniesinvestinChinaandChinesecompanies

havestartedtoinvestinNorway.AccordingtoofficialChinesefigures,Norwayhasmade

258separateinvestmentsinChina.tothisdatethreeChinesecompaniesareestablished

inNorway;Zte,COsCOandAirChina.

sino-Norwegianeconomiccooperationisstronginseveralsectors;themaritimesector,

theenergysector,themarinesector,tourismandtheenvironment.thesesectorshave

aconsiderablepotentialforfurthercooperation.theeconomiesofNorwayandChina

aretoalargedegreecomplementaryandsino-Norwegiantraderelationsarebasedon

comparativeeconomicstrengths.

thesino-NorwegianmixedCommissionforeconomyandtradeformedin1980isan

importanttoolinthebilateraleconomicrelationsbetweenChinaandNorway.Inaddi-

tiontodiscussingmattersrelatingtothegeneralframeworkforeconomicrelations

betweenChinaandNorway,thecommissionhandlesspecificbusinessissuesinvolving

theauthorities.Inseptember2006,ChinaandNorwayestablishedasub-committeeon

investmentsundertheJointCommission.thefirstmeetingtookplaceinJanuary2007.

thereareanumberofimportantagreementsbetweenChinaandNorwaysuchas

thetrilateralAgreementonmaritimeresearchbetweenChina,Norwayandsinga-

pore(August2006),theAgreementforestablishingasub-committeeforinvestments

(september2006),themouonenhancingCooperationinenergyConservationand

renewableenergy(september2006)andtherenewedAgreementonfisheriesCoopera-

tion(theupdatedversionofthe2001agreementwassignedinmarch2007),Approved

destinationstatus(Ads)Agreement(2004),Agreementofmaritimetransport(2003),

andabilateralinvestmenttreaty(bIt)(1984).

economicdevelopmentisconnectedtosustainabledevelopment,andawarenessofthe

linkagesbetweentradeandsustainabledevelopmentisincreasinginbothNorwayand

China.ChinaandNorwayarebothcommittedtotheobjectiveofsustainabledevelop-


ment,takingintoaccountsocial,environmental,culturalandeconomiccircumstancesin

eachcountry.Afruitfulcooperationonenvironmentalissueshasbeenongoingformore

thanadecade,andincludesawiderangeofactivities.ChinaandNorwayarealsoparties

toseveralmultilateralagreementswithintheareaofsustainabledevelopment,andhave

bothactivelyparticipatedatmilestoneeventssuchastheWorldsummitonsustainable

developmentinJohannesburg,southAfrica,2002.thetwogovernmentsalsoagreeon

theimportanceofsuccessfulandcompleteimplementationofrelevantlegislationand

policiesinordertoachievetheobjectiveofsustainabledevelopment.bothChinaand

Norwayopposethemisuseofstandardsinthesustainabledevelopmentareaasaform

ofdisguisedeconomicprotectionism.

thegovernmentsofChinaandNorwaywelcomethisJointstudyreportandtheefforts

onbothsidestoworktogethertoexplorepossibilitiesforincreasedtradeandinvest-

mentsbetweenthetwocountries.furthermore,theyrecognisethattheirstrengthened

bilateraltradeandeconomiccooperationmayalsoprovideimportantcontributions

towardstheobjectiveofsustainabledevelopment.

1.2 An introduction of the economies of China and Norway

1.2.1 The Chinese economy

Chinabegantoadoptthepolicyofreformandopeningtotheoutsideworldattheend

ofthe1970s,whichmarkedthebeginningofChina’stransitiontoamarketeconomy.

theprocessofChina’sentryintotheWtOhasmadethecountry’seconomicsystem

morecompatiblewiththeworldsystem.followingChina’saccessiontotheWtOin2001,

theChinesegovernmenthasconductedamassiverectificationandmodificationofthe

domesticlegislationandintroducednewlegislationsthatprovideChinawithasound

legalbasisforgoverningitsmarketeconomy.

sincetheadoptionofthereformandopeningpolicy,China’seconomicdevelopment

hasbeenspectacularwithgdpincreasingatanaverageannualrateof9.7%inthe1980s

and10.7%inthe1990s.sincethebeginningofthenewcentury,Chinahasregistered

asolidgrowthtrack,anditseconomyhascontinuedexpandingquickly.theeconomy

expandedbymorethan10%ineachofthelastfiveyears,atanaverageof10.4%.that

ismorethandoubletheaveragegrowthrateoftheworldeconomyduringthesame

period.ItshouldbenoticedthatChina’seconomyremainedstableasitsteamedahead.

Inthelastfiveyears,thegrowthrateneverfluctuatedbymorethan1.1%.meanwhile,

consumerpriceshavealsoremainedstableincreasingabout2.1%peryear.

China'seconomywastheworld'sfourthlargestin2006.thegapbetweenChinaandthe

u.s.,Japanandgermany–thetopthreeworldeconomies–hasalsonarrowedinterms

ofgdp.Chinanowcontributesmorethan5.5%totheworld'sgdp.


China'sboomingeconomyalsosawitspercapitaincomecrossthethresholdofus$

2,000forthefirsttimein2006.AccordingtoWorldbankstandards,Chinashouldno

longerbeconsideredalow-incomenation,asitspercapitaincomenowresemblesthat

ofamiddle-incomecountry.

China’seconomicdevelopmenthasalsobeenassociatedwithasurgeinthegrowthof

foreigntrade.China’stotalmerchandiseimportsandexportsreachedus$1761billionin

2006,increasingby24%comparedwiththepreviousyear,inwhichexportsincreased

by27%(us$969billion)andimportsincreasedby20%(us$792billion),makingChina

thethirdlargesttradingcountryintheworld.meanwhile,theconditionofinterna-

tionalbalanceofpaymentimproved,withtheforeignexchangereservessignificantly

increasing.

theseeconomicsuccessesstemfromtheeffectivemacro-economicregulationofthe

centralgovernmentutilisingfiscalandmonetarypolicies.Combinedwithstronggrowth

indomesticconsumptionandinvestment,andrapidintegrationintotheworldeconomy,

thesefactorsshouldcontinuetosustainChina’srapideconomicgrowthanddevelop-

mentinthelongterm.

1.2.2 The Norwegian economy

Norwayhasoneofthehighestgdppercapitaintheworldandrankssecondineurope,

behindluxemburg.In2005Norwegiangdppercapita(atpurchasingpowerparity)was

169%oftheaveragelevelinthe25eumemberstates.

petroleumactivitieshavecontributedsubstantiallytoNorway’sgdp,exportsand

governmentrevenuessincethelate1970s.Norway’spetroleumindustries,including

crudeoilandgasextraction,accountedfor26%ofgdpandabouthalfofallexports

in20062.Norwayranksastheworld’sfifthlargestoilexporterandthetenthlargest

producer.estimatesindicatethattheremainingresourcesontheNorwegianconti-

nentalshelfwillpermitprofitableoilproductionfor50moreyearsandgasproduction

foralmostacentury.developmentofthenewresourceswilldependuponanumberof

factorsincludinggovernmentpolicies,expectationsregardingfutureoilandgasprices,

costreductionsandtechnologicaladvances.

Althoughpetroleumactivitiesareimportantfortheeconomy,employmentinthepetro-

leumindustryonlyamountsto1,4%oftotalemploymentinNorway.thisunderlinesthe

importanceofthecontinueddevelopmentofthemainlandeconomyforthewell-being

ofthesocietyassuch.

AsignificantshareoftheNorwegianeconomyconsistsofserviceindustries,including

wholesaleandretailtrade,banking,insurance,engineering,transportandcommunica-

2 sources:statisticsNorwayandtheministryofpetroleumandenergy


tionsandpublicservices.In2005,theservicesectorasawholeaccountedforapproxi-

mately52%ofgdp3.

manufacturingaccountedforapproximately9%ofgdpin2005.themajormanufac-

turingindustriesareindustrialandagriculturalmachinery,constructionofoilplatforms

andships,paperproducts,metalproducts,basicchemicalsandelectricalandelectronic

equipments.theseindustriesareallhighlyexport-oriented.

since1990,Norwayhasrecordedsurplusesinthetradebalanceeveryyearexceptin

1998.In2006thesurplusreached18%ofgdp(us$60.8billion).Countriesintheeuhave

historicallybeenamongNorway’smostimportanttradingpartners.In2006,about82%

ofmerchandiseexportswereshippedtotheeumembers,and69%ofthemerchandise

importscamefromthesamearea.pursuanttothe1973freetradeagreementbetween

Norwayandeu,tariffsonmostindustrialproductswereeliminated.theeeAagreement

hasledtotheeliminationofanumberoftheremainingtariffs.

Attheendof2005thestockofforeigndirectinvestments(fdI)inNorwayamountedto

us$80.3billion.europeaninvestorsownedmorethan70%ofthiscapital.thepetroleum

sectorreceivedabout31%oftotalfdI,and28%weredirectedtowardsmanufacturing.

OtherimportantindustriesattractingfdIinNorwaywerewholesale,retailtradeand

financialintermediation.

Attheendof2005thestockofNorwegianfdIabroadamountedtous$102.6billion.

Overhalfofthiswasconcentratedineurope(56%),20%wenttoNorthAmericaand

11%toAsia(ofwhichsingaporereceived6%).Investmentsinoilandgasexploration

increasedto32%oftotalNorwegianfdI,whereastheshareofmanufacturingand

miningindustriesdecreasedto36%.Investmentsinservicessuchastransportactivities,

postandtelecommunicationsisgrowing(9%attheendof2005).

Astocapitalmarkets,foreigninvestorshaveownedapproximatelyone-thirdofthe

NorwegianstockexchangeinOsloformorethanadecade.thisreflectsNorwaybeing

anopeneconomy,andisinlinewiththeownershipstructureofopeneconomiesof

comparablesize.AboutanotherthirdoftheOslostockexchangeisownedbythe

Norwegianstate.

thepublicsectorplaysanimportantpartintheeconomy.fullemployment,sustainable

development,fairdistributionandastrengtheningoftheNorwegianwelfaresystemare

theprimaryobjectivesofeconomicpolicy.Withaviewtoachievingtheseobjectives,

fiscalpolicyissetinaccordancewiththeeconomicpolicyguidelinesimplyingagradual

phasinginofpetroleumrevenuesintotheNorwegianeconomy.

thegovernmentpensionfund–globalisafiscalpolicyinstrumentthatvisualizesthe

useofpetroleumrevenuesthroughanannualtransfertothetreasury.Overtimetheuse

ofpetroleumrevenues,measuresbythestructural,non-oilbudgetdeficit,shallcorre-

3 AllfiguresarethoseofstatisticsNorwayunlessothersourcestated


spondtotheexpectedrealreturnonthegovernmentpensionfund–global,estimated

at4%.

theNorwegianeconomyiscurrentlyexperiencingitsstrongestexpansioninthirty

years.Annualgrowthingdpexcludingshippingandpetroleumindustries(main-

landeconomy)hasbeenmorethan4.5%since2004.thisiswellabovethehistorical

averagefrom1980to2006of2.6%.themainfactorshavebeenstronggrowthinprivate

consumption,anupswinginmainlandfixedbusinessinvestmentsaswellashighinvest-

mentsinthepetroleumsector.

thegrowthcapacityoftheNorwegianeconomyishigh.thisisduetostrongproduc-

tivitygrowthandincreasedavailabilityofforeignlabour.Capacityutilisationhasnever-

thelessreachedaveryhighlevel,asaresultofstrongactivitygrowth.enterprisesreport

ashortageofqualifiedlabour,andmanypositionsarevacant.

byinternationalstandardsNorwegianunemploymentislowandemploymenthigh.

theunemploymentratehasbeenunder4%since2006.In200675.4%ofthepopulation

between15and64wasemployed.Norwayhasespeciallyhighemploymentforwomen

(72.2%ofwomenbetween15and64areemployed)andforelderlyworkers(67.4%of

peoplebetween55and64areemployed)4.

monetarypolicyisgearedtowardsmaintaininglowandstableinflation.theoperational

targetisdefinedasanannualincreaseinconsumerpricesofcloseto2.5%overtime.

theinterestratedecisionsofNorgesbank(thecentralbank)shallbeforwardlooking,

andpaydueattentiontotheuncertaintyattachedtomacroeconomicestimatesand

assessments.Consumerpriceinflationhasbeenrelativelylowforthepastfewyears

(1–1.5%)despitestrongeconomicgrowth.drivingforcesbehindarethecontinued

dropinpricesonimportedconsumergoodsandaslowerpaceinthepriceincreaseson

domesticallyproducedgoods.easymonetarypolicyhasbeenanimportantcontributorto

domesticgrowth.theNorwegianinterestrateiscurrently(asofNovember2007)5,25%.

1.3 Objectives and structure of the study

thestudyseekstosetouttheopportunitiesandchallengesforChinaandNorwaythat

abilateralftAmaybringontradeandinvestment.Inaddition,thisstudycanvassesa

widerangeofotherissuesofmutualinterest,highlightingoptionstoenhanceeconomic

cooperationbetweenChinaandNorway.AbilateralftAwouldbeconsistentwithWtO

rules,andbothsidescouldbuildontheirWtOcommitments.Italsoshouldbepointed

outthatthestudyiswithoutprejudicetowhetherpossiblefutureftAnegotiations

betweenChinaandNorwaywouldtakeupallissuesintheformsconsideredinthis

study.

4 source:eurostat


thefollowingarethetermsofreferencesetoutfortheJsgstudy:

•totakeacomprehensiveviewofbilateraleconomiclinkagesbetweenChinaand

Norway,coveringi.a.tradeingoodsandservices,investmentandotherareasof

economiccooperation,andgiveconcretesuggestionsonwaysandmeansto

encourageclosereconomicengagementbetweenthetwosides;

•toreviewandexaminetheexistinginstitutionalandlegalframe-workgoverning

bilateraltradeandinvestmentrelationsofChinaandNorwaywiththeobjectof

identifyingconstraints,barriersandimpedimentsforincreasingbilateralcoopera-

tionandrecommendmeasurestobeadoptedforincreasingcooperation;

•toexaminetheexistingregionaltradingarrangementsofChinaandNorwaywith

theirrespectivetradepartnersandevaluateitsimpactuponanypossibleChina-

Norwayarrangement;

•toconsiderthepossibilityandscopeofafreetradeagreementincludingcommon

disciplinesondifferenttradeandinvestmentareasandtraderelatedcooperation;

•toexaminealltheaspectsoftheexistingbilateraleconomicrelationshipbetween

NorwayandChina;

•tomakeotherrecommendationsinareassuchasenvironmentalanddevelopment

issues;

•tomakeotherrecommendationsforclosercooperationissuesofcommoninterest

inmultilateralandcommercialforums;and

•toprovideareferentialbasisfordecisiononabilateralChina-Norwayfreetrade

AgreementbythegovernmentsofChinaandNorway.

ChapterOneofthisstudyprovidesanoverviewofbilateraleconomicrelationsbetween

ChinaandNorwayandestablishestheobjectivesandstructureofthisstudy.

Chaptertwotofouraccountfortheexistingbarrierstotradeingoods,servicesand

investmentsbetweenChinaandNorway;andprovideananalysisonthescopeforand

potentialimpactofliberalisation,inbroadtermsaswellasinspecificsectors.

Chapterfiveidentifiesothersector-specificissuesandbroaderareasandopportuni-

tiesforfacilitatingcooperationwiththeobjectivesofstrengtheningbilaterallinkages

throughanftA.

Chaptersixcontainstheconclusionsandrecommendationofthisstudy.

15

Chapter two: Impact of trade liberalisation in goods

tradeingoodsaccountsforalargeproportionofbilateraltradebetweenChinaand

Norway.thischapteroutlinestheimpactoftradeliberalisationonindustrialgoodsand

agriculturalproducts.Itprovidesanoverviewofthestructureoftariffandnon-tariff

measuresthatareappliedinChinaandNorway,andexplorestheopportunitiesand

challengesoftradeliberalisationonindustrialgoodsandagriculturalproductsthrough

sectoralreviews.

2.1 An overview of Chinese trade policies applying to trade in goods

2.1.1 Tariffs

thecustomstariffofimportandexportofChinaiscompiledonthebasisoftheharmo-

nisedCommoditydescriptionandCodingsystem(hs)oftheWorldCustomsOrgani-

zation.AccordingtotheRegulation on Import and Export TariffofChina,dutyrateson

importscomprisemostfavouredNation(mfN)tariffrates,agreementtariffrates,special

preferentialtariffrates,generaltariffrates,tariffquotaratesandinterimtariffrates.

•mfNtariffratesshallapplytogoodsimportedfromandoriginatedinthemembers

oftheWorldtradeOrganisation(WtO),providingthemfNtreatmentismutually

reciprocalbetweenChinaandthesemembers;orthosecountriesorregionswith

whichChinahasconcludedabilateraltradeagreementforreciprocaltariffprefer-

ence;ortheCustomsterritoryofChina;

•theagreementtariffratesshallapplytogoodsimportedfromandoriginated

incountriesorregionswhichjointogetherwithChinaintoregionaltrade

agreementsfortariffpreferences;

•thespecialpreferentialtariffratesshallapplytogoodsimportedfromand

originatedincountriesorregionsthathaveconcludedspecialtariffpreferential

agreementswiththepeople’srepublicofChina.generallyspeaking,thespecial

tariffratesareapplicabletotheldCs;

I m pA C t O f t r A d e l I b e r A l I s At I O N I N g O O d s16

•thegeneraltariffshallapplytoimportedgoodsoriginatedfromothercountries

and/ortoimportedgoodsofundeterminedorigin;

•thetariffquotaratesshallapplytoimportedgoodswhicharesubjecttothetariff

quotaadministrativeregulations;and

•theinterimtariffratesareappliedforaspecificperiodoftimetocertaingoods.

AsamemberoftheWtO,Chinabeganin2002tobindtariffsforallproductsandreduce

tariffinaccordancewiththescheduleofcommitmentsonmarketaccessforgoods,and

hasbeenfulfillingitscommitmentsontariffreductionfromthenon.

In2006,China’saveragetarifflevelwas9.9%.theaveragetarifflevelofindustrialpro-

ductswas9.0%,andthetariffsofmostofthemechanicalproductswerereducedto5%,

withsomereducedtozero.China’scurrentaveragetarifflevelforagriculturalproducts

is15.2%.5table2-1showsthedispersionofChina’starifflinesin2006.

In2007,China’saveragetarifflevelis9.8%.China’scurrentaveragetarifflevelforagri-

culturalproductsremainsat15.2%,whiletheaveragetarifflevelofindustrialproducts

hasbeenchangedfrom9.0%to8.95%.the2007CustomstariffofImportandexportof

thepeople’srepublicofChinawasmodifiedbasedonthehs2007versionoftheWorld

CustomsOrganisation(WCO).

2.1.2 Tariff quota

Chinaeliminatedtariffquotasonsoybeanoil,palmoil,rapeoilon10itemsin2006.At

present,theproductsstillsubjecttotrQadministrationinChinaincludewheat(6items),

maize(5items),ricewhetherornotbusked(14items),sugar(6items),wool(6items),

wooltops(3items),cotton(2items)andchemicalfertilizer(3items).

2.1.3 Rules of origin

Non-Preferential Rules of Origin

Withregardtothenon-preferentialrulesoforigin,thestateCouncilofthepeople’s

republicofChinahasenactedRegulations of the People’s Republic of China on the Origin

of the Imports and Exports,whichenteredintoforceon1January2005.theseregulations

areapplicabletotheorigindeterminationoftheimportedandexportedgoodseligible

fornon-preferentialtradesuchasmost-favoured-Nationtreatment,anti-dumpingand

countervailingmeasures,safeguardmeasures,originmarkings,country-specificquanti-

tativerestrictionsandtariffquotas.

5 Note:Allthetarifflevelslistedinthisparagraphareappliedtariffrates.

17r e p O r t N O r WAy – C h I N A

China’sNon-preferentialrulesofOriginarebasedonthefollowingcriteria:wholly

obtainedandsubstantialtransformation.substantialtransformationisapplicableto

origindeterminationwhenmorethanonecountryorregiontakepartintheproduction

ofagood.thecriterionofsubstantialtransformationismainlybasedonchangeintariff

classification.Othercriteriasuchasadvaloremvalueaddedpercentageandmanufac-

turingorprocessingoperations,shallbeappliedassupplementarycriteria,providedthat

changeintariffclassificationdoesnotreflectsubstantialtransformation.

Preferential Rules of Origin

preferentialrulesoforiginareapplicabletoproductsoriginatingfromcountrieswith

whichChinahasconcludedfreetradeAgreements.theprimarycriteriaofpreferential

rulesofOriginarewhollyobtainedandregionalValueContentcriteria.theproduct

specificCriteriaincluderegionalValueContentcriterion,changeintariffclassification

andmanufacturingorprocessingoperationscriteria.

(1) CEPA

mainlandChinahassignedtheClosereconomicpartnershipArrangement(CepA)with

hongKongandmacaorespectively.InCepA,thecriteriafordetermining“substantial

transformation”includemanufacturingorprocessingoperationscriterion,changein

tariffclassificationcriterion,30%value-addedcontentcriterion,othercriteriaormixed

criterion.

(2) Special Preferential Tariff Treatment

Chinahasgrantedspecialpreferentialtarifftreatmenttosomeoftheleastdeveloped

Countries.thecriteriaofspecialpreferentialtarifftreatmentincludechangeintariff

classificationand40%value-addedcontentcriteria.

(3) The Free Trade Agreements (FTA)

Atpresenttime,ChinahasconcludedftAswithAseAN,pakistanandChile.Inallofthese

ftAs,therulesoforiginarebasedonthe40%regionalValueContentcriteria.Asfor

someparticularproducts,productspecificrulesareintroduced.

2.1.4 Other aspects of trade policy

The World Trade Organisation (WTO)

sinceWtOAccessionindecember2001,Chinahasalwaysbeensupportingthe

strengtheningofthemultilateraltradingsystemandadvocatingthepreservationand

disseminationoftheWtOsfundamentalprinciplesguidinginternationaltradingrela-

tions.Chinafirmlybelievesthatthefair,openandnon-discriminationprinciplesprovided

byWtOareconducivetothestabilityandpredictabilityofinternationaltradeandtrade

development.theWtOembodiesthespiritofmultilateralisminfavourofjointpartici-

pationininternationalaffairs.


eversinceaccession,ChinahasimplementeditsWtOaccessioncommitmentsandmade

comprehensiveadjustmentsofitstraderegimeandtradepolicy.Atthesametime,China

hassystematicallyoverhauledexistinglaws,administrativeregulationsanddepartment

rulestocomplywithWtOrulesandaccessioncommitments.Alltheprinciples,rulesand

requirementsembodiedintheWtOAgreementandtheprotocolontheAccessionof

Chinaareimplementedinacomprehensiveandeffectivemanner.governmenttranspar-

encyhasbeensignificantlyenhanced.theChinesegovernmenthasalsoestablishedthe

WtONotificationandenquiryCentreintheministryofCommercetoprovideinforma-

tionconcerningChina'stradepolicy,andtofulfiltheobligationofnotificationofChina's

tradepoliciesandmeasuresasspecificallyrequiredbytheWtOAgreement.thegeneral

publichasfreeaccesstoinformationconcerningtrade-relatedlaws,regulationsand

rulesthroughtheChinaforeigntradeandeconomicCooperationgazette,whichisalso

availableatthewebsiteoftheministryofCommerce (www.mofcom.gov.cn).

ChinahasbeenactivelyparticipatingintheWtOdoharoundoftradenegotiations,

whichhasastrongbearingonthefuturedevelopmentofinternationaltrade,the

possibilityofbalancedandorderlydevelopmentoftheworldeconomyandisinthe

immediateinterestsofthepeopleoftheworld.theChinesegovernmentisoftheview

thattheearlyconclusionofthedoharoundwithbalancedresults,willupholdthemulti-

lateraltradingsystem,andwillpromotefurthertheliberalisationofinternationaltrade.

tothisend,Chinahassubmittedmorethan30proposalsandpositionpapersinthe

negotiations,whichhaveplayedapositiveandconstructiveroleinadvancingthe

negotiations,bridgingunderstandingamongWtOmembersandnarrowingdifferences.

Regional trade liberalisation

Chinabelievesthatregionaleconomicandtradecooperationisanobjectivetrend

intheworldeconomyandtrade,aswellasanaturalchoiceforcountriesandregions

throughouttheworldinadaptingtotheacceleratingprocessofglobalisation.regional

tradeliberalisationhelpsbringdownbarrierstointra-regiontradeandinvestment.It

couldbecomeausefulsupplementtothemultilateraltradingsystemandhelppush

forwardglobaltradeliberalisationandinvestmentfacilitation.

uptonow,ChinahasconcludedClosereconomicpartnershipArrangements(CepA)with

hongKongspecialAdministrativeregion(sAr)andmacaosAr,signedtheframework

AgreementonComprehensiveeconomicCooperationwiththeAssociationofsouth-

eastAsianNations(AseAN),theAgreementontheearlyharvestprogramwithpakistan,

andthefreetradeAgreementwithChile.Chinaisalsoamemberstateofthebangkok

Agreement6.ChinaiscurrentlynegotiatingftAswithAustralia,NewZealand,singapore,

IcelandandthegulfCooperationCouncil(gCC).

6 thebangkokAgreementisaninitiativeundertheeconomicandsocialCommissionforAsiaandthepacific(esCAp)fortradeexpansionthroughexchangeoftariffconcessionsamongdevelopingcountrymembersoftheesCApregion.thisagreementwassignedon31stofJuly1975amongbangladesh,India,laopdr,republicofKorea,srilanka,thephilippinesandthailand.ChinaaccededtothebangkokAgreementin2001.

http://www.mofcom.gov.cn


Trade remedy measures

ChinahasestablishedatraderemedyregimeundertheWtOrules.thedomesticlegisla-

tionofChinesetraderemediesmainlycomprisestheforeigntradelawofthepeople’s

republicofChina,theAntidumpingregulationsofthepeople’srepublicofChina,the

Countervailingregulationsofthepeople’srepublicofChinaandsafeguardmeasures

regulations.Inaddition,ministryofCommerce,beingtheinvestigativeauthority,has

stipulated24regulationsofadministrationsaboutantidumping-,countervailing-and

safeguardmeasuresinvestigationaccordingtotheauthorizationofadministrativeregu-

lations.untilnowmostofChina’slegislationsontraderemedieshavebeennotifiedto

WtO.

Chinainitiatesandcarriesouttraderemedyinvestigationsinaccordancewiththe

relevantChineselaws,regulationsandtherelevantprovisionssetforthindifferentWtO

agreements,andensuresthatinterestedmembershaveduepossibilitiestoparticipatein

theinvestigationoftraderemediesbydeliveringtheiropinions.Chinaprotectsthelegal

profitsofinterestedmembersduringtheinvestigation,ensuringtheprincipleoftrans-

parencyanddueprocedurestomakethedecisionbasedonoutcomeoftheinvestiga-

tionfairly.theaimofChinabyapplyingtraderemediesistomaintaintheorderofinter-

nationaltradeandcarryoutfairforeigntradepolicies,andnottoapplytraderemedy

measurestorestrictregularimports.

fromdecember1997whenChinainitiatedthefirstanti-dumpinginvestigationon

importednews-printingpapertoOctober2007,Chinahasinitiated48anti-dumping

cases.Chinahasinitiated150anti-dumpinginvestigations(accordingtothestatis-

ticalmethodofWtOwhereoneproductforonecountrycountsasoneinvestigation).

throughinvestigation,definitivemeasureswereadoptedin37casesandnomeasures

in9cases.presentlythereare2casesstillunderinvestigation.

uptonow,Chinahasnotinitiatedanycountervailinginvestigationsconcerning

importedproducts.

Chinainitiateditsfirstsafeguardinvestigation(onimportsofcertainsteelproducts)

inmay2002upontherequestbyarelevantdomesticindustry.Chinadecidedto

imposedefinitivesafeguardmeasuresonfivecategoriesofimportedsteelproducts

inNovember2002.On26december2003,Chinaannouncedtheterminationofthe

safeguardmeasuresontheimportedsteelproducts.


Ta

ble

2-1

Ch

ina’

s Ta

riff

Dis

per

sio

n F

or

20

06

Sect

ors

Tota

l＝

0%0%

<X

<=

5%5%

<X

<=

10%

10%

<X

<=

15%

15%

<X

<=

20%

>20

%Sp

ecifi

cSi

mp

le A

vera

ge

Ap

plie

d T

ari

ff

Agricultureexcludingfish

1090

8176

271

274

208

173

715.2%

fishandfishproducts

185

1716

3797

171

010.5%

petroleumOils

191

117

0　0

00

6.3%

Wood,pulp,paperandfurniture

361

132

71132

422

00

5.0%

textilesandClothing

1069

0196

385

245

231

120

11.4%

leather,rubber,footwearandtravelgoods

219

115

9440

4227

013.1%

metals

750

32237

357

7537

120

7.3%

Chemicalandphotographicsupplies

1261

9168

1019

1410

437

7.0%

transportequipment

318

161

138

479

620

13.3%

Non-electricmachinery

884

101

150

478

130

1114

08.0%

electricmachinery

493

157

33157

7223

465

9.0%

mineralproducts,preciousstonesandmetals

365

41142

7451

1740

08.8%

manufacturedArticlesn.e.s.

591

7466

130

156

8976

011.7%

Allgoods

7605

647

1232

3289

1205

716

467

499.9%

Note:thistableisbasedonappliedmfNdutiesin2006.

source:ministryoffinance,China


2.2 An overview of Norwegian trade policies applying to trade in goods

2.2.1 Tariffs

theNorwegianCustomstariffisbasedontheConventionontheharmonisedsystem

(hs).theNorwegianparliamentadoptstheratesofcustomsdutyeachyear.the2007

versionoftheNorwegianCustomstariffcontains7025eight-digittarifflines.1295of

theselinesarewithintheagriculturalsector.

Industrial sector, including fish and fisheries products

Only299tarifflinescovergoodsliabletocustomsduty.Allthesecodesarewithin

Chapters61–63oftheharmonisedsystemNomenclature,coveringclothingand

anumberfinishedtextilearticles.theratesvaryfrom0(zero)to13,7%(clothingfrom

0(zero)to10,7%).

Agricultural sector

Norwayhasboundmosttarifflinesforbothadvaloremandspecificrates.Currentlyin

theagriculturalsector439tarifflinesarefullydutyfreeand98tarifflinesaresubjectto

advaloremduties.theremaining758tarifflinesareliabletoaspecificduty(perkg,per

itemorperlitre).thetypeofdutyusedforeachagriculturalproductfortheupcoming

yearisannouncedinlegislationeachyeargivingcertaintytoexportersonwhichduty

thatwillbeapplicableforexportstotheNorwegianmarket.

theadvaloremratefor10tarifflinesarebelow10%,64between10%and99,9%.24lines

aresubjecttoarateof100%orabove,withthemaximumratebeing555%.thetarifflines

coveredbyspecificdutyratesaredistributedasspecifiedintable2-2hereunder:

Table 2-2

Specific duty rates Number of tariff lines

NOK0,01–0,99perkg 120

NOK1,00–9,99perkg 320

NOK10,00–99,99perkg 270

NOK100,00orabove 36

NOKperliter 5(beer)

NOKperitem 7(liveanimals)

fewpoliciesthatdirectlyaffectexportsareinplaceinNorway.exportlicencesare

requiredonlyforarmsandotherstrategicgoods,andforwhaleproducts.permission

(exportlicence)fromtheministryofforeignAffairsisrequiredfortheexportfrom

Norwayofsuchgoods,servicesandtechnologies.exportsoffishandfishproductsare

subjecttoastatutoryfeeforfinancingtheNorwegianseafoodexportCouncil(NseC).

NseCistheNorwegianseafoodindustry’scombinedmarketingandinformationcouncil.


General System of Preferences (GSP)

Norwayhasageneralsystemofpreferences(gsp)scheme,whichallowsforpreferential

tariffsonimportsfromdevelopingcountriesandduty-freeandquota-freemarketaccess

forallproductsoriginatinginleast-developedcountries.theaveragetariffonimports

fromnon-ldCdevelopingcountriesis5.5%.

thepeoplesrepublicofChinahassince22march1979beenabeneficiarycountry

undertheNorwegiangsp-scheme.

2.2.2 Quantitative restrictions

thefollowingproductsaresubjecttoWtOminimummarketaccesscommitments

undertheWtOAgreementonAgricultureatafourtoeight-digithsheadinglevel:

meatofbovineanimals,frozen;meatofswine,frozen;meatofsheepandgoats(fresh,

chilledorfrozen);meatoffowlofthespeciesgallusdomesticus;meatofturkeys;meatof

poultryducks,geese,andguineafowl;meatofgame;butter;hens’eggsandwhiteandred

cabbage.Inaddition,Norwayhasglobalquotasatthehssixtoeight-digitlevel(apples,

pearsandturkeyroll)andonequotaatthetwo-digitlevel(meatforpromotionalfairs

andproducttesting).

thequotafillrateforthesequotasaregiveninthetableunder:

Table 2-3

Minimum access and other global quotas

hsheadingno.

Chapters02and16

descriptionofgoods

meattopromotionalfairsandproducttesting

Quantity

25tonnes

fillrate2006

36%

ex0202 meatofbovineanimals,frozen 1,084tonnes 100%

0203.2100 meatofswine,frozen 1,381tonnes 37%

ex0204 meatofsheepandgoats(fresh,chilledorfrozen) 206tonnes 98%

0207.1200 meatoffowlofthespeciesgallusdomesticus 221tonnes 45%

0207.2500 meatofturkeys 221tonnes 0%

0207.3300 meatofpoultryducks,geese,andguineafowl 221tonnes 37%

0208.1000,9030,9099 meatofgame 250tonnes 87%

0405.1000 butter 575tonnes 53%

0407.00.19 hens’eggs 1,295tonnes 100%

0704.90 Whiteandredcabbage 268tonnes 9%

0808.10 Apples 8000tonnes* 84%

0808.20 pears 250tonnes 98%

16.02.3101 turkeyroll 20tonnes 97%

*Onapples,quotasareallocatedoverthreeperiodseveryyear:7,000tonnesareallocatedfor1mayto31July;750tonnesfor1Augustto30November;and250tonnesfor1to30November.


2.2.3 Rules of origin

Non-preferential rules of originareusedtodeterminetheoriginofgoodsforvarious

purposes,likeimport-andexportrestrictions,markingregulations,theapplicationof

mfNratesofdutyandothertradeinstruments.

Preferential rules of originareusedtodeterminewhetheraproductqualifiesundera

freetradeAgreement(ftA)forpreferentialtreatmentuponimportationintoapartner

country.rulesoforiginarenecessarytorestrictthebenefitsreciprocallynegotiatedto

thepartiestotheftAconcerned.Ataminimumsuchrulesshouldensurethatgoods

thataremerelytranshippedorsubjectonlytominimalprocessingintheterritoriesof

thepartiestotheftA,donotqualifyfortariffpreferencesundertheftA.Ingeneral,a

productisconsideredtooriginateinapartyifithasbeenwhollyobtainedthere,or,

wheresomeinputstotheproductioniscomingfromoutsidetheftAareaorwhere

somepartoftheproductionprocesstookplaceoutsideoftheftAarea,ifthegood

resultedfromsubstantialtransformationinthatparty.

•Whollyobtainediswhereagoodiswhollyproducedormanufacturedinone

countryfrommaterialswhollyoriginatingineitherftApartnercountry.

•substantialtransformationcanbedefinedeitheracrossallproductsorona

product-by-productbasis,byapplyingoneofthefollowingmethodsoracombina-

tionofthese:

Changeintariffclassificationmethod:underthismethod,aproductafteri.

productionisrequiredtobeclassifiedunderadifferenttariffclassification

fromthatofitscomponentmaterials;

Value-addedmethod:underthismethod,aminimumpercentageoftheii.

valueofaproductmusthavebeenaddedwithinthecountryorpreferen-

tialareaforwhichoriginisbeingclaimed(i.e.thevalueofinputmaterials

fromanon-partyisrestricted);and

specifiedprocessormanufactureoperationsmethod:underthismethod,iii.

theoriginisbasedonthecountryinwhichaspecifiedmanufacturingor

processingoperationforaspecificproductisundertaken.

Acombinationoftheabovemethods.iv.

preferentialrulesoforiginarenegotiatedseparatelyforeachfreetradeAgreementby

thepartiestothatftAinaccordancewiththespecificcircumstancesofthoseparties.

Non-preferential rules of origin

thefollowingnon-preferentialrulesoforiginhavebeenpresentedtotheNorwegian

parliamentaspartofanewCustomsAct,foradoptionin2007:

Iftheoriginofaproductistobedeterminedwithoutbeingbasedonaspecific(1)

agreementonpreferentialtarifftreatmentwithforeignstateororganization,

therulesoforiginsetoutinparagraphs(2),(3)and(4)shallapply,subjectto

anyobligationsapplicabletoNorwayunderinternationallaw.theprovisions


setoutinparagraphs(2),(3)and(4)alsoapplytomfNtreatmentinaccordance

withArticleIofthegeneralAgreementontariffsandtrade,anduponissueof

proofsoforiginforaproductnotcoveredbyafreetradeagreementorauto-

nomouspreferentialarrangement.

Aproductisconsideredtooriginateinthecountrywhereitiswhollyobtained,(2)

orwherethelastsubstantialprocessingtookplace.theterritoryofacountry

includesitsterritorialsea.

thefollowingproductsshallbeconsideredaswhollyobtainedinacountry:(3)

mineralproductsextractedfromthesoilofthecountry;i.

vegetableproductsharvestedinthecountry;ii.

liveanimalsbornandraisedinthecountry;iii.

productsfromliveanimalsraisedinthecountryandproductsfromiv.

hunting,fishingandtrappinginthecountry;

productsofseafishingandotherproductstakenfromtheseaoutsidethev.

territorialseaofacountrybyvesselsregisteredinthecountryorinthe

ship’sregistryofthecountryandflyingtheflagofthecountry;

productsmadeaboardfactoryshipsexclusivelyfromproductsreferredtovi.

under(e),andoriginatinginthecountry,providedthatthesefactoryships

areregisteredinthecountryorintheship’sregistryofthecountryand

flyingtheflagofthecountry;

productsextractedfrommarinesoilorsubsoiloutsidetheterritorialsea,vii.

providedthatthiscountryhassolerightstoworkthatsoilorsubsoil;

wasteandscrapresultingfrommanufacturingoperationsconductedinviii.

acountry,andusedarticlesifcollectedinthecountryandfitonlyforthe

recoveryofrawmaterials;and

productsmanufacturedinthecountryexclusivelyfromproductsspecifiedix.

under(a)to(h),orfromtheirderivativesatanystageofproduction.

Wheremorethanonecountryhavebeeninvolvedinthemanufactureofa(4)

product,thecountryoforiginshallbethecountryinwhichthelastsubstantial

andeconomicallyjustifiedworkorprocessingtakesplace,andresultinginthe

manufactureofanewproduct,orrepresentinganessentialstepinthemanu-

factureofaproduct.re-packaging,sorting,mixingorminorchangesarenot

consideredbeingworkorprocessing.

theministrymaygivearegulationontheimplementationoftheserulesof(5)

origin,includingrequirementsforevidencesoforiginandtheexpansionof

thescopeofapplicationtooriginmarking,governmentprocurementandtrade

statistics.


Preferential rules of origin of the Norwegian GSP-system

Norwayhasbeenadonorcountrywithinthescopeofthegspsystemsasof1971.since

then,therulesoforiginhavebeenrevisedandliberalisedseveraltimes,andduringthe

lateryearstheruleshavebeenharmonisedineurope.

therulesoforiginintheNorwegiangsp-schemearebasedonthefollowingprinciples.

•Whollyobtainedcriterion

•Changeoftariffclassificationofmaterialsused

•Inalistofproduct-specificoriginrules,specificproductionrequirementsmustbe

fulfilledfortheproductsmentionedinthelist.

•forsomeproductstherearespecificrequirementslikeforexamplemanufacture

fromyarn;forsomeproductstherearevalue-addedrules;andforotherproducts

acombinationrulemightbeapplicable.

•Atoleranceruleof5%maybeapplied,exceptfortextileproducts.

InadditiontheNorwegiangspschemecontainsprovisionsforcumulationoforiginwith

originationproductsunderthefollowingregimes:

–bilateralcumulation

–diagonalcumulationwithproductsoriginatinginswitzerlandortheeuropean

Communityonareciprocalbasis

–regionalcumulation(AseAN)

therulesoforiginforuseintheNorwegiangsp-systemaregiveninaministerialregu-

lationdated20february1998(fOr158).

Preferential rules of origin of the Norwegian Free Trade Agreements

sincetheestablishmentoftheeftA-conventionin1960,Norwayhasappliedpreferential

rulesoforiginforthebenefitofthebusinesscommunityreceivingpreferentialtariffs

intradebetweentheparties.Abilateralfreetradeagreementwasestablishedbetween

NorwayandtheeuropeaneconomicCommunityin1973.theagreementontheeuro-

peaneconomicAreaenteredintoforce1January1994betweenthememberstatesof

theeuropeanCommunityandthreeeftAstatesNorway,Icelandandliechtenstein.since

then,theeuropeanrulesoforigin,beinganintegralpartoftheNorwegianfreetrade

agreementsinforce,havebeenadjustedseveraltimes,andaretodayanupdatedand

moderninstrumentforthedeterminationofpreferentialstatusofproductstobetraded

betweenthepartiesconcerned.

since1997,NorwayandthethreeothereftAstatesIceland,switzerlandandliechten-

stein,haveparticipatedinthesystemofpan-europeancumulationoforigin.thissystem

currentlycomprisesthe27eu-countries,the4eftAstatesandturkey.thepan-european

cumulationsystemallowsforfreeuseoforiginatingmaterialsthroughouttheeuropean

continent.however,“fullcumulation”isallowedonlybetweenthememberstatesofthe

eeA.


Adecisionwastakenin2005topavethewayfortheextensionofthissystemtonine

mediterraneanpartners(Algeria,egypt,Israel,Jordan,lebanon,morocco,syria,tunisia

andthepalestinianAuthorityoftheWestbankandgazastrip)andaswellthefaroe

Islands.thissystem,beingreferredtoasthepaneuro-mediterraneancumulationsystem,

iscurrentlyunderdevelopmentandexpandsaccordingtothespeedofimplementing

revisedoriginprotocolsandnewfreetradeagreementsbetweentheparties.the

extendedsystembecomeseffectiveamongcountriesthathaveconcludedfreetrade

agreementswiththeeuandeftAcountriesandwitheachother(atleasttriangular

tradewithidenticalrulesoforigin).

Inthefreetradeagreementswithcountriesoutsidethepan-euro-mediterraneancumu-

lationsystem,Norwayhas,alongwiththeothereftAstates,appliedrulesoforiginthat

arebasedonthelayoutofthepan-euro-mediterraneanmodel,providingforbilateral

cumulationpossibilitiesbetweenthepartiestotheftA.

theharmonisedrulesconsistoftwomainparts:

1)generalrulesthatidentifythebasicprinciplesofrOO:productsneedtobeeither

“whollyobtained”or“sufficientlyworkedorprocessed”inthecountryconcernedinorder

tobeconsideredoriginatingandtobeeligibleforpreferentialtarifftreatmentwithinthe

freetradearea.theyalsoincluderulesonevidencesoforiginandaswellasadministra-

tivecooperationforthesubsequentverificationofsuchproofoforigin.

2)listrules:aproduct-by-productlistofcriteriarequiredforproductstobegranted

originatingstatus,suchas

–changeintariffheading(aproductisconsideredoriginatingintheexportingcountry

ifithasbeensufficientlytransformedinthatcountrytobeclassifiedunderadifferent

headingatfour-digitlevelintheharmonisedsystem);

–sufficientprocessing(theoriginisdeterminedintermsofspecificprocessingopera-

tionsnecessarytogivetheproductitscurrentcharacteristics);

–valueaddedcriterion(theoriginisdeterminedintermsofthevaluethatmayhave

beenaddedtotheproductintheexportingcountry);or

–acombinationoftheabove.

theNorwegianpreferentialrulesoforiginforapplicationinfreetradeagreementsin

forcearegiveninaministerialregulationdated13december2004(fOr1702).

2.2.4 Other aspects of trade policy

The World Trade Organisation (WTO)

Asstatedin2.2,multilateraltradeliberalisationthroughtheWtOisthefirstofthethree

maintracksonwhichNorwaypursuesitstradeliberalisationpolicy.

NorwaywasoneofthefoundingmembersofthegAttin1947andremainsstrongly

committedtothemultilateraltradeframeworkundertheauspicesoftheWtO.Astrong,


rules-basedsystemisthebestguaranteeagainstunilateralismandprotectionism,and

provides,stability,security,transparency,andpredictabilityfortraders.

NorwayfirmlybelievesthatallWtOmembersstandtogainsignificantlyfromfurther

tradepolicynegotiationsaimedatstrengtheningthemultilateraltradingsystemand

improvingmarketaccessforgoodsandservices.economicgrowthanddevelopment

inallnations–andparticularlyindevelopingcountries–dependsonastrongand

fairmultilateraltradingsystem.Norwayisthereforestronglycommittedtothedoha

developmentAgenda(ddA).Norway’smainobjectivesintheongoingnegotiations

aresubstantialimprovementsinmarketaccessforindustrialgoods(includingfishand

fishproducts),withthelong-termgoalofabolishingtariffsandunjustifiednon-tariff

measures,improvedmarketaccessforservices,strongerdisciplinesintheareaofanti-

dumpingmeasuresandtheeliminationoffisheriessubsidiesthatleadtoincreased

fishingcapacity.furtherNorwaywantstomaintainacertainlevelofdutiesanddomestic

supportintheagriculturalsector.thatisimportantformakingitpossibletomaintaina

viableagriculturalsectorinahighcostcountry.

Norwayhasalsounilaterallyliberalisedtradeingoodsandservicesinordertoharvest

theeconomicbenefitsofsuchmeasures.equallyimportant,Norway’stariffsystemand

administrativeproceduresforimporthaveundergonesignificantcomputerisationand

simplificationoverthelastfewyears.Norwayhastakenunilateralstepstopromotetrade

withdevelopingcountriesbyimplementingimprovementstoitsgsp.

tradepolicyhasincreasinglybecomeatopicforpoliticaldebateinthepublicdomainin

Norway.Inadditiontothetraditionaldebateontheeconomicmeritsoftrade,increasing

emphasisisbeingputonotheraspectssuchashealth,environment,foodandconsumer

safety.toensurethecontinuedsupportofthegeneralpublicforthemultilateraltrading

systemoftheWtOaswellasforregionaltradeagreements,thegovernmentconsults

extensivelyatthenationallevelwithnon-governmentalgroups,includingrepresenta-

tivesoftradeandindustry,labour,consumerandotherinterestedorganisations.Norwe-

giantradepolicyenjoysbroadpoliticalsupportinthestorting(theNorwegianparlia-

ment).

The European Economic Area

theeuropeanunionisNorway’smostimportanttradingpartner.In200682%oftotal

Norwegianexportsofgoodswenttothismarket,amountingtous$71,5billion.Oiland

naturalgasarebyfarthemostimportantNorwegianexportarticlestotheeuwithover

72%shareoftotalexports.Correspondingly,importsfromtheeuconstitutedapproxi-

mately69%oftotalNorwegianimportsin2006,equivalenttous$43,5billion.

Norway’stradeandeconomicrelationswiththeeuaremainlygovernedbytheAgree-

mentontheeuropeaneconomicArea(theeeAAgreement)7.theeeAAgreement

enteredintoforceon1January1994andunitesthe27eumemberstatesandthethree

7 theAgreementmaybefoundonthefollowingwebsite:<http://secretariat.efta.int/Web/europeaneconomicArea/eeAAgreement/eeAAgreement>


eeAeftAstates(Iceland,liechtensteinandNorway)inanInternalmarketgovernedby

thesamebasicrules.

theserulesaimtoenableindustrialgoods,services,capital,andpersonstomovefreely

abouttheeeAinanopenandcompetitiveenvironment,aconceptreferredtoasthe

fourfreedoms.exceptforcertainfisheries’andagriculturalproducts,theeeAAgreement

providesforfreetrade(zerotariffs).

theeeAAgreementprovidesacommonsetofrulesfortradeandeconomicrelations.

IntheareascoveredbytheeeAAgreement,Norwegianbusinessesandnationalsare

entitledtotheequaltreatmentasbusinessesandnationalsofeustatesacrosstheentire

Internalmarket.

theeeAAgreementprovidesfor:

•participationintheinternalmarket,withfreemovementofgoods,services,persons

andcapital.thismeansi.a.thataproductapprovedinonecountryunderthe

commonrulesnormallyhastobeacceptedintheothercountries.Workers,self-

employed,serviceprovidersandstudentsfromothereeAcountriesaregenerally

entitledtoequaltreatmentwiththenationalsofthehostcountry,includinginthe

areasofsocialsecurityandtherecognitionofoccupationalqualifications;

•harmonisationofrulesandrequirementstowhichgoodsandservicesare

subjectforreasonsofhealth,safetyandenvironmentalprotectionandtoprotect

consumerinterests;

•Commonrulesregulatingcompetition,stateaidandpublicprocurementtoensure

alevelplayingfieldforallenterprisescompetingintheinternalmarket;

•extensivecooperationinotherareasofsociety,mostimportantlyinresearch,

education,environmentalprotection,consumerpolicy,culturalaffairs,socialpolicy,

genderequality,tourismandsmallandmedium-sizedenterprises;but

•theeeAAgreementdoesnotcovertheeu’scustomsunionoritscommontrade

policywithnon-memberstates.NoraretheeeAeftAstatesincludedintheeu’s

commonagriculturalpolicyorthecommonfisherypolicy,meaningthattheeeA

Agreementdoesnotincludeacommonresourcemanagementregime.Itdoesnot

allowfreemarketaccessforallagriculturalandfishproducts,thoughitprovidesfor

lowercustomsdutiesandbettermarketaccessforanumberofsuchproducts.

theeeAAgreementisconstantlyevolving.Whenevernewrulesgoverningtheinternal

marketareadopted,theeeAAgreementisamendedtobringtheAgreementinlinewith

theseneweurules.thisisdonethroughdecisionsbytheeeAJointCommittee,onwhich

theeftAcountriesandtheeuropeanCommissionarebothrepresented.Allnewrules


thatareadoptedintheeeAJointCommitteemustbeincorporatedintonationallaw

oftheeeAeftAstates.

theeftAsurveillanceAuthorityandtheeftACourtarechargedwithensuringthatthe

eftAcountriescomplywiththeirobligationsundertheeeAAgreement.Contributions

fromtheeeAeftAcountriestowardseconomicandsocialdevelopmentinthepoorereu

countrieshavebeenpartoftheeeAAgreementsinceitfirstenteredintoforce.priority

sectorsforsupportunderthemechanismsincludeenvironmentalprotection,sustain-

abledevelopment,culturalheritage,promotionofeducationandtraining,moreeffective

externalbordercontrolsandstrengtheningthejudiciary,andhealthandchildcare.

European Free Trade Association (EFTA)

AsamemberstateofeftA(Iceland,liechtenstein,Norwayandswitzerland)Norwayhas

currentlyconcludedfreetradeagreementswith16statesorgroupofstates(Canada,

Chile,Croatia,egypt,Israel,Jordan,lebanon,macedonia,mexico,morocco,republicof

Korea,southernAfricanCustomsunion,singapore,thepalestinianAuthority,tunisiaand

turkey).eftAiscurrentlyengagedinfreetradenegotiationswithAlgeria,Colombia,the

gulfCooperationCouncil,peruandthailand.AjointfeasibilitystudybetweeneftAand

IndiawascompletedinOctober2007.

OneofeftA’smaingoalshasbeentocontributetotheexpansionoftradeintheworld

atlarge.sincethebeginningofthe1990s,eftAhasactivelypursuedtraderelationswith

thirdcountriesinandbeyondeurope.AguidingprincipleforeftA’snegotiationswith

thirdpartycountrieshasbeentosecurethateftAbusinessesenjoythesamerightsand

privilegesasbusinessesfromtheeuinforeignmarkets.Inmorerecentyears,theeftA

stateshavealsoprioritisedftAnegotiationsbasedonindependenteconomicconsid-

erations,regardlessoftheeustraderelationswiththethirdpartycountryinquestion.

WhenactingtogethertheeftAcountriesnegotiatetheirfreetradeagreementsasa

group,speakingwithonevoiceatthenegotiatingtable.however,eftAdoesnothavea

commontradepolicy–allmemberstateshavetoagreeonthenegotiationparameters

priortoeachroundofnegotiations.thus,eachmembercountrymaintainsfullsover-

eigntyintheprocess.

freetradeagreementsprovideincreasedpredictabilityandimprovedmarketaccess

conditionsintradebetweenNorwayandthepartnercountryhencepavingtheway

forincreasedtwo-waytrade.Inasituationwhereanincreasingnumberofcountries

arenegotiatingmarketaccessonapreferentialbasisNorway’sftAssecureNorwegian

economicinterestsinimportantinternationalmarketsandarethereforeanintegralpart

ofNorwegiantradepolicy.

AprincipleineftAsfreetradeagreementsistoachievefulldutyandquotafreetradein

industrialgoods(includingfishandfishproducts)andtomakecertaintariffreductions

foragriculturalproducts.


ItshouldbenotedthatwhiletheeftAcountriespursueapolicyofconcludingfreetrade

agreements,thisdoesnotdetractthemfromgivingprioritytoawell-functioningmulti-

lateraltradesystemundertheauspicesoftheWtO.thetwoapproaches,bilateraland

multilateral,aremutuallysupportive.

Trade remedy measures

Norwayhaslawsandregulationsthatallowtheimpositionoftraderemedymeasures

(anti-dumping,countervailingandsafeguardmeasures)inaccordancewithourinter-

nationalobligationsandWtOrules.however,Norwayhasnotcarriedoutanyanti-

dumping,anti-subsidyorsafeguardinvestigationsnorappliedanysuchmeasuresduring

thelasttwodecades.thusNorway’spolicyregardingapplicationoftraderemediesisin

practiceoneofnon-application.

toNorwayitiscrucialthatthesolutionsadoptedinftAstowhichNorwayisapartyare

consistentwiththegeneraltradepolicyofNorwayconcerningsuchmeasures.Inthe

presentWtOnegotiationsNorwayisastrongadvocateforastrictandstringentappli-

cationoftraderemedymeasures.

InrespectoftradebetweenpartnersthathaveenteredintofreetradeAgreements,

Norwayadvocatesapolicyofnon-applicationofanti-dumpingandcountervailing

measures.AsregardssafeguardmeasuresinaccordancewithgAttArticleXIXandthe

WtOAgreementonsafeguards,Norway’sviewisthatsuchmeasuresinaccordancewith

theseprovisionscannotbeappliedagainstftApartnersthatareWtOmembersandthe

bilateralftAspecificallyprohibitssuchmeasures.

Norwegian agricultural policy

OnlyfewareasinNorwayaresuitableforagriculture.duetothecountry’stopography,

fieldsareoftensmall,scatteredanddifficulttocultivateefficiently.Ofthetotalarea,only

2,7%isfarmland.theclimatealsodetermineswhichcropscanbegrownandtheiryield

level.

Importantobjectivesfortheagriculturalpolicyaretoproducesafefoodtotheconsumer

andpublicgoods,aswellasnon-tradeconcernssuchasfoodsecurity,securingsettle-

mentinruralareasandculturallandscapes.AgricultureinNorwayproducestherefore

morethanjustfoodandfibres.

NorwayappliestariffsonmanyagriculturalproductstoenableNorwegianfarmersto

selltheirproductsdomestically.thetariffsforkeyNorwegianproductsareashighas

300–450%,buttheaveragedutyforallagriculturalproductsis39%.

thecustomsdutiesandpreferencesboundintheWtOandinftAsforagricultural

goodscangenerallybesaidtobehigher,toaccordforthehigherdomesticprice,for

commoditiesproducedinNorwaythanforproductsnotproduceddomestically.the

mostimportantagriculturalproductsforNorwayare:meat,dairyproducts,grainsand


somefruitsandvegetables.thismeansthatNorwayinftAsgivesmostpreferencesto

otherfruitsandvegetables,flowersandnon-sensitiveproducts.

2.3 Current trends of trade in goods between China and Norway

tradeingoodsbetweenChinaandNorwayhasincreasedsubstantiallyduringthepast

fewyears.In2006,thetotalvalueoftradeingoodsbetweenChinaandNorwayreached

us$2950.44million,comparedwithus$981.67millionin2001,indicatingathreefold

increase.theexportsofgoodsfromChinatoNorway,whichwasus$410.99in2001,

increasedtous$1700.71millionin2006.Norway’sexportsofgoodsdestinedforChina

wasus$1249.37millionin2006,anincreaseof119%comparedto2001.

Table 2-4 Annual Value of Trade in Goods between China and Norway

(US$ million)

Year China’s exports Norway’s exports Total value

2001 411 571 982

2002 527 929 1450

2003 899 865 1765

2004 1029 1398 2426

2005 1322 1144 2466

2006 1701 1250 2950

*thestatisticsof2006iscalculatedaccordingtoChina’scustomstatistics.

source:Chinastatisticsyearbook,2002-2006.

IndustrialgoodsarethemostsignificantexportsofChinatoNorway,accountingfor

nearly98%ofallexportedgoodstoNorwayoriginatinginChina.In2006,themain

productsChinaexportstoNorwayincludeapparelandaccessories(us$766.61million),

officemachines,dataprocessingmachines(us$552.26million),telecommunication

apparatusandequipment(us$438.53million),electricalmachineryandapparatus

(us$208.88.million),andmanufacturesofmetals(us$162.24million).8

8 source:statisticsNorway,http://www.ssb.no/.

http://www.ssb.no/


Table 2-5 China’s Main Merchandise Exports to Norway

(US$ million)

HS06 Description Value of exports

84713000portableAdp,weight≤10kg,withatleastCpu/keyboard/display

6.8

89019041 motorbulkcarriers,loadingcapacity≤150000t 5.8

89012011 refinedpetroleumtankers,loadingcapacity≤100000t 5

85252022 radiotelephonehandsets 4.6

61103000Jerseys,pullovers,etc,ofman-madefibres,knittedor

crocheted4

61102000 Jerseys,pullovers,etc,ofcotton,knittedorcrocheted 3.9

73089000 structure/partsnes,prepdplate,rodsetcforstruct,i/s 3.9

62046200 Women’sorgirls’trousers,breeches,etc,ofcotton 3.3

61091000t-shirts,singlets&othervests,ofcotton,knittedor

crocheted3.2

62104000 men’sorboys’garmentsoffabricsof59.03,59.06or59.07 2.5

source:China’sCustomstatistics,2006.

petroleumandpetroleumproducts,generalindustrialmachineryandequipment,fish,

chemicalsandrelatedproducts,non-ferrousmetalsarethemainproductsthatNorway

exportedtoChina.In2006,theseproductsaccountedformorethan80%ofNorway’s

totalexportstoChina.

Table 2-6 Norway’s Main Merchandise Exports to China

(US$ million)

HS06 Description Value of exports

27090000petroleumoils&oilsobtainedfrombituminous

minerals,crude17.6

31052000

mineralorchemicalfertilizerscontaining

thethreefertilizingelementsnitrogen,

phosphorus&potassium

11.4

75021000 Niunwrought,notalloyed 9.8

29242990Cyclicamides(incl.cycliccarbamates)andtheir

derivatives;saltsthereof,nes7.3

03037400 frozenmackerel 4.3

25161100 granite,crudeorroughlytrimmed 3.8

03036000 frozencod(excl.livers&roes) 2.7

03037990 frozenfish,nes 2.6

84138100 pumpsnes 2.5

03037200 frozenhaddock 2.3



2.3.1 Technology goods: machinery, electronic equipments and optical instruments 9

Chinaisoneoftheworld’smostimportantproducersandexportersofmachineryand

electronicequipments,whichhasbeenthebiggestcategoryofChina’sexportsduring

thepastdecade.mirroringtheeconomicdevelopmentandupgradeofindustrialstruc-

ture,China’simportsinthiscategoryhavealsobeenincreasingrapidlyinrecentyears.

AccordingtothelateststatisticsfrommOfCOm,thetotalvolumeofChina’smachinery

andelectronicequipmentstradereachedus$977.18billionin2006,amongwhich

exportsaccountedforus$549.42billion,rankingthethirdoftheworld,andimport,

us$427.76billion,rankingthesecondoftheworld.

Norway'srobusteconomicdevelopmentinrecentyearshasbeenconducivetotheengi-

neeringmachineryandequipmentindustryofthecountry.Atpresent,Norwayisalsoa

competitiveproducerofcertaintechnology-intensivemachineryandtransportequip-

ment.machineryandequipmentsfortheshipbuildingindustrymakesupanimportant

partofthesector.shipyardshavealongtraditioninNorway,andcontinuetoplayavital

roleinmanycommunities.Norwegianshipyardsmainlybuildsmallandmedium-sized

specialistships,suchasproducttankers,chemicaltankers,supplyshipsandhigh-speed

passengerboats.Norway’sshipbuildingtraditionshavealsoledtothedevelopmentof

hi-techproductionofmaritimeequipment.Anotherimportantpartofthetechnology

industrysuppliesoilplatformsandotherhighlyspecialisedequipmenttothepetro-

leumindustry.therearealsoniche-orientatedtechnologycompaniesinothermarkets

supplyingproductssuchasreversevendingmachines,videoconferencingsystems,

advancedcarparts,andpressuresensorsforvehiclesandtheoffshore-industry.exports

bythetechnologyindustryconstitutearound9%ofNorway’stotalexports,andnearly

twicethatwhenpetroleumexportsisexcluded.Animportantfeatureofthisbusiness

sectoristhatasignificantshareofthesuppliesissemi-manufacturedproductsand

elementsthatarepartoftheproductionprocessesinothercountriessuchasChina.

muchofthesector’sgrowthoverthelastfewyearshastakenplaceabroad.

technologygoodsareanimportantcontributortomerchandisetradebetweenChina

andNorway.In2006,thetwo-waytradeinthiscategoryreachedus$728.1million,

amongwhichChina’sexportstoNorwaytotalledus$350.4,andimportstotalled

us$377.8million.

9 “technologygoods”refertothecommoditiesunderChapter84,85and90oftheharmonisedsystem.


Table 2-7 China’s exports of machinery and electronic equipments to Norway

(2004–2006, US$)

HS Description

2004 2005 2006

technology(hs84,85,90) 107.1 236.7 350.4

84 machineryincl.computersetc. 52.9 102.6 148

85 electricalmachineryandequipment 46.3 120.4 178.6

90 Opticalinstrumentsetc. 7.9 13.7 23.9


Table 2-8 China’s imports of machinery and electronic equipments from Norway

(2004–2006, US$)

HS Description

2004 2005 2006

technology(hs84,85,90) 309.7 340 377.8

84 machineryincl.computersetc. 179.3 191 216.1

85 electricalmachineryandequipment 94.4 103.9 109.1

90 Opticalinstrumentsetc. 36.1 45.5 52.5


machineryandelectronicequipmentsconstitutealargeshareofChineseexportsto

Norwayandtheexportvaluehasbeenrapidlyincreasingoverthelastfewyears.Norway

importsagreatvarietyofChinesetechnologies.however,reflectingtheincreasingpopu-

larityinNorwayforhighqualityChinesecomputers,televisionsets,CdplayersanddVd

players,themajorityofChinesetechnologyexportstoNorwayareconsumerelectronics.

Oftheabove-mentionedproducts,personalcomputersconstitutethelargestimport

category.Otherconsumerelectronicssuchasradios,tVs,Cd-anddVdplayers,andoffice

machinepartsarealsoimportedinlargeandincreasingquantities.

OverthelastthreeyearsNorwayhasexperiencedarapidgrowthintechnologyexports

toChina.theincreaseofsuchgoodswassubstantialin2006byover51%comparedto

theyearbefore.Closeto70%ofNorway’sexportsoftechnologyproductsaremachin-

eries(hs84).liquidpumpsprimarilyusedinships,hadthelargestshareofmachineries

in2006byapproximately25%.Astheexportofship-equipmentsuchaspumpsareinter-

linkedwiththeincreasinglyactiveChineseshipbuildingindustry,theprospectsoffuture

growthofNorwegianmachineryexportstoChinaarebright.

InaccordancewithChina’scommitmentstotheWtO,theaveragetarifflevelofChina

formachineryproductswasreducedto10%in2005,andthatforelectricandelectronic

productswasloweredto9%.Norwayexempttariffonimportedmachineryandelec-

tronicequipmentandimplementstechnicalregulationsinaccordancewithinterna-

tionalstandards.


tosomeextents,thebilateraltradeofmachineryandelectronicequipmentbetween

ChinaandNorwayhasthecharacteristicsofintra-industrytrade,andisfairlycomple-

mentary.Chinahascomparativeadvantagesinrelativelabour-intensiveelectronicpro-

ducts,whileNorwayhascomparativeadvantagesintechnology-intensiveones.Conse-

quently,apossibleftAprovidesanopportunityforencouraginggrowthintwo-way

tradeinthissectorthroughfurtherliberalisationintariffandnon-tariffmeasures.

2.3.2 Textiles and apparel10

Chinaisthebiggestproducerandexporteroftextilesandapparelproductsintheworld.

AccordingtothelateststatisticsfromChinaCustoms,thetotalvolumeofChina’stextilesand

apparelproductstradereachedus$162.06billionin2006,anincreaseof22.6%overthelast

year,amongwhichexportsaccountedforus$144billion,andimportsus$18.1billion.

thetextileandapparelindustryofNorwayhasalonghistoryofdevelopment.however,

exposuretoforeigncompetitionresultedintheearlyrestructuringofNorwegian

consumermanufacturingindustry,suchastheoncethrivingNorwegiantextileindustry.

Atpresent,theindustry,whichconsistsofabout495companiesand5000employees,

accountsformerely0.3%ofNorway’sgdp.AbigproportionofNorway’smarketdemand

fortextileandapparelproductsdependsonimports.

textilesandapparelproductshavebeenoneofChina’stopexportstoNorwayfor

manyyears.China’sexportsinthiscategoryin2004and2005valuedrespectively

us$501millionandus$430.8million.In2006,theexportvalueincreasedfurtherto

us$572.4million,accountingfor45.1%ofChina’stotalexportstoNorwaythatyear.

themostimportanttextilearticlesexportedfromChinatoNorwayin2006arepull-

overs/cardigans(hs611030,us$40.3million),cottonsweaters(hs611020,us$39.4

million),andwomentrousersofcotton(hs620462,us$32.6million).

Table 2-9 China’s Textiles and Apparel Exports to Norway

(US$ million)

HS Description

2004 2005 2006

finishedtextileproductsandclothing(hs61–63)

501 430.8 572.4

62ArticlesOfApparelAndClothingAccessories

244.6 191 265.4

61ArticlesOfApparelAndClothingAccessories,knit

198.2 184 237

63made-uptextileArticlesNesoi;Needlecraftsets

58.1 56.3 70.1


10 refertothecommoditiesunderChapter61–63ofharmonisedsystem.


Diagram 2-1 The five largest exporters of finished textiles and clothing in 2006

– share (%) of total imports

sourceofdata:statisticsNorway

diagram2-1showsthefivemostimportantexportersoftextilesandclothingtoNorway

in2006.Asonecansee,Chinanowhasthelargestmarketshareoftotalimportsof

suchproductstoNorway.In1997China’sshareoftotaltextilesandclothingimports

was19.4%,comparedtoeusshareof57.6%.In2006Chinasurpassedeuasthelargest

exporteroftextilesandclothingtoNorway.China’sshareoftotaltextilesimportsto

Norwayin2006was36.9%.

Accordingto China’s Schedule of Concessions and Commitments on Goods intheWtO,

China’sfinalboundratesoftextilesandapparelproductsrangeasfollows:yarns5–6%,

fabric10–18%,apparel14–20%,andfinishedproducts10–17.5%.reductionsonall

butoneitem(hs5512.11.00)werecompletedinaccordancewiththetariffreduction

scheduleby1January2005.

Norwaystillmaintains299tarifflinesliabletocustomsdutywithinChapters61–63of

theharmonisedsystemNomenclature,coveringclothingandanumberfinishedtextile

articles.thesetariffsaremaintainedinordertoprotectthefewremainingproducers

intheindustry.thetariffratesvaryfromzeroto13.7%.AmajorityofChina’sexportsto

Norwayinthiscategoryaresubjecttoatariffrateof10.7%.

takingintoaccountthattheeu,throughtheeeA-agreement,turkey,throughtheeftA-

turkeyftA,andbangladeshasarecipientofNorwegiangspinwhichthecountry

isgrantedleastdevelopedCountry(ldC)-treatment,enjoytariff-freeaccesstothe

Norwegianmarket,asino-NorwegianftAmayfurtherstrengthenChina’spositionin

theNorwegianmarketforfinishedtextilesandclothing.however,itshouldbenoticed

thatNorwayhasexperiencedatransformationofitstextilesandapparelindustryin

recentyears.productionandresourceshavetoalargeextentswitchedfromlowcost

apparelareastohighvalueapparelsectors.Ashiftoffocustowarddesign,logisticsand

0

500

1000

1500

2000

2500

3000

3500

4000

LDC

GSP

EU

Other countries

2006200520042003


marketingarealsofeaturesoftheindustryoverthepastdecade.Inthissense,apossible

ftAwouldprovideanopportunityforfurthersupportingtwo-waytradeoftextilesand

apparelproducts.Amoreliberalisedtrade-regimeinthiscategorywouldlowerthecost

ofNorwegianconsumersonclothingmanufacturedbyChina,resultinginincreased

Chineseproductionandhenceinvestmentsassociatedwiththeindustry.theimpactof

furthertariffliberalisationonNorway’stextileandapparelproducerscouldalsobetaken

intoaccountinthefutureftA,althoughtheimpactisexpectedtobelessthanthestruc-

turaladjustmentalreadyunderwayasaresultofdomesticreformandglobalisation.

2.3.3 Oil, natural gas and chemical products

productionofoilandgasontheNorwegiancontinentalshelf(NCs)startedin1971,and

todaytherearemorethan50fieldsinproduction.In2006,thesefieldsproduced2.8

millionbarrelsofoil(includingNglandcondensate)perdayand88billionstandard

cubicmetres(scm)ofgas,foratotalproductionofsaleablepetroleumof249millionscm

oilequivalents(o.e.).In2006Norwayrankedastheworld’sfifthlargestoilexporterand

thetenthlargestoilproducer.

In2006,crudeoil,naturalgasandpipelineservicesaccountedfor51%ofthevalueof

Norway’sexports.thevalueofpetroleumexportswasus$79,3billion.greatsumshave

beeninvestedinexploration,fielddevelopment,transportinfrastructureandlandfacili-

ties.Investmentsin2006amountedtous$14,9billion,or24%ofthecountry’stotalreal

investments.

CreatingNorwegianandNorwegian-basedpetroleumexpertisehasbeenanimportant

elementinNorwegianpetroleumpolicy.today,Norwayhasahighlydevelopedand

internationallycompetitivepetroleumindustry.thisappliestotheoilcompanies,where

statoilhydroisthelargest,thesupplyindustryandtheresearchinstitutions.supply

companiesinNorwayarerepresentedinmostpartsofthevaluechain,fromexplora-

tionanddevelopmenttoproductionanddisposal.Norwegiansuppliersareamongthe

leadingintheworldinfieldssuchasseismicsurvey,drillingequipment,subseafacilities

andfloatingproductionsolutions.

Alargeresourcebaseandthecompetenceandtechnologylevelinthepetroleumsector

areveryimportantassetstoNorway.Norwaycontinuestofocusonlongtermactivities

ontheNorwegianContinentalshelfandatthesametimegiveattentiontointernational

marketsforthesupplyandserviceindustries.thevariouselementsinthepetroleum

policyhavedevelopedovertimeandinclosedialoguebetweenthedifferentinterests.

generally,ithasbeenveryimportanttopursueasustainablepetroleumpolicythat

allowsfordueconsiderationsoftheenvironmentandaconcernforfuturegenerations.

IthasbeenaguidingprinciplefortheNorwegianresourcemanagementtoopenup

theNorwegianContinentalshelfforforeigncompaniesgradually.thereasonisthat

thisenablesNorwaytolearnfromoneareaandgainmoreknowledgebeforeopening


upnewareasforpetroleumactivities.thereareconsiderablevariationsregardingthe

degreeofmaturityinthedifferentareasoftheNorwegianContinentalshelf,withthe

barentsseanorthofNorwaybeingtheleastexploredpartoftheshelf.

manyofthepetroleum-relatedgoodsmanufacturedinNorwayincludesophisticated

technologystemmingfromdomesticresearchandengineeringservices.Norwegian

technologyisworldleadingindifferentareaswithinoffshoretechnologyandthepetro-

leumandgasindustryisthelargestindustryinNorway.

takingadvantageofthecountry’srichoilandgasresources,Norwayhasdeveloped

internationallycompetitivecompanieswithinthepetrochemicalindustry.

China’spetroleumreservesandoutputrankfirstintheAsia-pacificregion.theestimated

recoverablepetroleumreserveofChinaisabout20billiontons,ranking6thintheworld.

AccordingtothefigurespublishedbyChinaNationalbureauofstatistics,theaverage

annualgrowthrateofChina’spetroleumoutputinthepasttenyearswas1.8%,whilethe

petroleumconsumptionofChinagrewatanaveragerateof4.9%inthesameperiodof

time,whichwasthehighestintheworld.Atpresent,Chinaisthesecondlargestcountry

intermsofpetroleumconsumptionintheworld,aftertheunitedstates.Consequently,

China’simportofpetroleumhasbeenincreasingatahighrateinthepastdecade.In

2006,China’simportofpetroleumreached145.2milliontonsatthecostofus$66.4

billion,rankingthirdintheworld,onlysurpassedbytheunitedstatesandJapan.

Chinaisalsooneofmostimportantproducersofchemicalproductsintheworld.

however,withtherapiddevelopmentofChina’seconomy,thedomesticallyproduced

chemicalproductscannotfulfilthehugeandgrowingmarketdemand.therefore,

currentlyabouthalfofChina’smarketdemandforchemicalproductsdependson

import.

bilateraltradebetweenChinaandNorwayinpetroleumandchemicalproductshas

grownsignificantlyinrecentyears,reflectinggrowthinChinesedomesticdemandand

continuedtariffliberalisationofpetroleumandchemicalproductsandothersectors

wherepetroleumandchemicalproductsareintermediaryinputs.In2006,thetotal

tradevalueofpetroleumandchemicalsproductsbetweenChinaandNorwayreached

us$1027.8million,amongwhichChina’simportstotalledus$936million.thesector

accountedfor17.4%ofthetotalbilateraltradeand54.8%ofChina’stotalimportsfrom

Norwayinthisyear.11

11 source:statisticsNorway,http://www.ssb.no/.

http://www.ssb.no/


Table 2-10 China’s Imports of Petroleum and Chemicals Products from Norway

(US$ million)

HS06 Description 2004 2005 2006

27090000petroleumoils&oilsobtainedfrombitu-

minousminerals,crude575.9 230.6 176

31050000

mineralorchemicalfertilizerscontaining

thethreefertilizingelementsnitrogen,

phosphorus&potassium

96.6 84.8 114

29242990Cyclicamides(incl.cycliccarbamates)

andtheirderivatives;saltsthereof,nes46.4 35.9 73.4

source:China’sCustomstatistics,2004-2006.

table2–10showsthatmineralfuels,oils,waxes&bituminoussub(hs27),organicchemi-

cals(hs29),andfertilizers(hs31)arethemostsignificantproductsthatNorwayexports

toChina.In2006,theseproductsaccountedforrespectively18.8%,12.1%and7.8%of

China’simportsofpetroleumandchemicalproductsfromNorway.

Asanetimporterofpetroleum,Chinadoesnotimposetariffonimportedcrudeoiland

naturalgas.thetariffratesofChinaappliedtothemajorityofchemicalimportsarein

therangeof0%–20%.tariffquotas(trQs)areappliedonchemicalfertilizers.Norway

hasboundtariffratesupto7%onsomechemicalproducts.12theappliedtariffrateof

chemicalproductsis,however,zero.

theestablishmentofthefutureftAwouldbeofgreatsignificancetothebilateraltrade

ofpetroleumandespeciallychemicalproducts,thusbringingbenefitsforbothChina

andNorway.theproducerswillbenefitfromincreaseddemandandpotentiallybetter

returnsforexports,andtheconsumerswillbenefitfromlowerpricesandincreased

supply.furthermore,theftAwillhelptoformalong-termmutuallybeneficialpartner-

shipbasedontrustbetweenthetwocountries.energysafetycooperationwillbenefit

bothChinaandNorwaybyprovidingthemfavourableconditionsforsustainable

economicdevelopment.

2.3.4 Metal products; including nickel, aluminium and iron/steel, and alloys of the before mentioned

themetalindustryaccountsforabouthalfofemploymentintheenergy-intensive

industryinNorway.Aluminiumisthesinglemostimportantproduct,withNorskhydro

beingthedominantcompany.Norskhydrohassignificantownershipinterestsin

foreignaluminiumcompanies,particularlywithinthefieldofprocessingrawmetals.

thecompanyisalsoinvolvedinaluminiumprocessinginNorway.rapiddevelopments

12 source:tariffprofileofNorway2006(WtO)


inthemetalindustryrequireNorwegiancompaniestospendsignificantresourceson

productimprovements.

theothermainproductgroupwithinthemetalindustryistheproductionofmetalsin

whichironisacomponent(ferro-alloys).byaddingmetalssuchaschromeandsilicon,

theironbecomeslesssusceptibletocorrosionandbettersuitedtotheproductionof

steelforcarsandships.Internationalcompetitionisalsostronginthispartofthemetal

industry.thelargestNorwegiancompanyinthisareaiselkem.

WiththeeconomicdevelopmentofChina,thestrongmarketdemandhasstimulated

therapiddevelopmentofthecountry’smetalindustry.forexample,Chinahasbeenthe

world'slargestcrudesteelproducersince1996andthelargestconsumersince2003.In

thecomingyears,itisestimatedthat60%ofsteelwillbemanufacturedandconsumed

inAsia,hereinparticularlyChina.Atpresent,Chinamanufactures34%oftotalmanufac-

turedsteelintheworldandconsumesabout33%.Chinahasalreadybecometheworld’s

biggeststeelmanufacturingandconsumingcountry.Itisestimatedthatthemetal

manufacturingandconsumptionofChinawillincreaserespectivelyto550mtand

530mtby2010.

Table 2-11 Metal products exports to China 2004–2006 (US$ million)

HS Description

2004 2005 2006

metalproducts(hs72–83excl.hs78&80) 70,5 127,7 174,2

75 Nickelandarticlesthereof 21,3 45,3 64

76 Aluminumandarticlesthereof 22,5 39 39,6

74 Copperandarticlesthereof 10 15,5 28,5

73 Articlesofironorsteel 6,9 13,6 20,8

72 Ironandsteel 9 12 18,6

83 miscellaneousarticlesofbasemetal 0,2 0,4 1,7

81 basemetalsnesoi;cermets;articlesthereof 0,5 1,6 0,7

82 tools,implements,cutleryetc. 0,1 0,03 0,2

79 Zincandarticlesthereof 0 0,002 0


NorwegianexportsofmetalproductstoChinahaveshownastronggrowthinthelast

threeyears,byalmosttriplinginvalue.themostimportantproductarticlesofmetal

exportstoChinaarenickel(us$64millionin2006)andaluminium(us$39,6million).

NorwegiannickelismainlyutilisedintheproductionofstainlesssteelinChina.Increased

productionofChinesesteelishencecorrelatedwithincreasedimportsofNorwe-

giannickel.theremovalofChina’sadvaloremtariffrateofcurrently3%forimported

unwroughtnickel(hs720210)willthereforecreatefurthersynergiesinthemetalindus-

triesofChinaandNorway.


Norwayisamajorproducerofaluminiumandexportssuperthinhigh-gradealuminium

plates(hs7606)totheChineseelectronicsindustry.In2006thevalueofNorway’sexport

toChinaofthesearticleswasus$15,6million.this,however,is40%lessthancompared

to2005.theremovalofthe6%tariffratescurrentlyinplaceinChinafortheseproducts

wouldensureasteadysupplyofNorwegianhigh-qualityaluminiumtoChinesemanu-

facturing.

Norwegianexportsofironandsteelarticles(hs73)havealsoshownastronggrowth,

increasingbyover52%from2005to2006.theseironandsteelarticlesaremainlyspecial

productsutilisedintheChineseshipbuildingindustry.dutyratesforsuchproducts

inChinaareintherangeof3–25%(averagedutyrangeisapproximately10%),clearly

indicatingthatasino-NorwegianftAwouldprovideimpetusforincreasedtrade.

Table 2-12 Metal products imports from China 2004–2006 (US$ million)

HS Description

2004 2005 2006

metalproducts(hs72–83excl.hs78&80) 156,4 185,4 222,2

73 Articlesofironorsteel 56,2 72,8 112,2

82 tools,implements,cutleryetc. 28,4 34,9 38,8

81 basemetalsnesoi;cermets;articlesthereof 50,8 47,7 30,9

83 miscellaneousarticlesofbasemetal 10,6 14,6 19,6

76 Aluminumandarticlesthereof 8,4 9,6 11,1

72 Ironandsteel 1,5 4,7 7,9

74 Copperandarticlesthereof 0,3 0,6 0,9

79 Zincandarticlesthereof 0,3 0,4 0,7

75 Nickelandarticlesthereof 0,002 0,005 0


ImportsofmetalproductsfromChinahavegrownannuallyoverthelastnineyears.from

1997to2006theNorwegianimportsofmetalproductsfromChinahaveincreasedfrom

us$31,2milliontous$222,2million.IronandsteelarticlesfortheNorwegianoffshore

industrydominateChinesemetalexportstoNorway.Intheoffshoreindustry,Chinese

qualitysteelisutilisedforheavysteelconstructions.Anotherimportantcategoryof

metalproductsimportedfromChinaistoolsandcutlery.In2006,thevalueofsuch

importedproductswasapproximatelyus$38,8million,anincreaseof11,2%compared

to2005.


2.3.5 Fish and marine products

fishing,aquacultureandfishprocessingindustriesareimportantcontributorstothe

economiesofChinaandNorway.

OverthelastfewdecadestheNorwegianwildcapturefishingindustryhasevolvedfrom

avirtuallyunrestrictedactivityintoahighlyregulatedindustrywithquotasandlicensing

requirements.theNorwegianfishingfleethasdevelopedinthedirectionoffewerand

moreefficientvessels.Atthesametime,Norwayhasacompositefishingfleetwith

respecttothesizeandtypeoffishingequipment–oceanfishingvesselsandalarge

numberofcoastalvessels.theNorwegianwildcapturefisheriesindustry,whichprovides

directemploymentforapproximately14,000people,isrepresentedbyadiversified

seagoingandcoastalfleetofapproximately7,300vessels.smallcoastalvesselsaccount

foraround6000ofthese.thetotalcatchesofNorwayvaryaccordingtoannualvaria-

tionsinthesizeofthemajorfishstocks,butamountedin2006to2,4milliontonnesper

year.sustainableresourcemanagementisfundamentaltotheNorwegianfishingpolicy.

simultaneously,fisheriesandfishingwillhelptosafeguardsettlementsandcreatenew

activityalongthecoast.

theNorwegianaquacultureindustryisamodern,internationallycompetitiveindustry

thatproduceshighqualityfoodinanefficientmanner.Atlanticsalmonandrainbow

troutarethedominatingspeciesintheaquacultureindustry.however,extensivedevel-

opmentistakingplacewithaviewtowardfarmingseveralnewspecies,suchascod

(gadus morhua),halibut(hippoglossus hippoglossus),wolffish(anarhichas spp.)and

shellfish.

AlicencefromtheauthoritiesisrequiredtofarmfishandshellfishinNorway.environ-

mentalconsiderationsandeffortsrelatedtofishhealthandwelfarearegivenhigh

priorityintheindustryandpublicadministration,andisanimportantconditionforthe

aquacultureindustry’sabilitytocompete.thefishfarmingindustryinNorwayholdsover

2,700licenses.

theNorwegianprocessingindustryconsistsofnearly700units,andemployapproxi-

mately10000people.

since2000China13hasseenastabledevelopmentofitsfishingindustries.In2004its

totalaquaticoutputreached47,5milliontonnes,whereof16,9milliontonnescamefrom

wildcapturefisheries.

Chinahasthelargestnumberoffishingvesselsandfishersintheworld.In2002the

numberofvesselswas220000.InrecentyearsChinesefisheriesauthoritieshavetaken

anumberofmanagementmeasures.

13 source:fAOfisheriesandaquaculturecountryprofile.


In2004,theChinesemarinecultureoutput(includingaquaticplants)reached13,7

milliontonnes.shellfishconsiststhehighestoutput,whilethesecondlargestisseaweed.

productioninmarineculturetakesthreeforms:inthesea,onmudflatsandlandbased.

InadditionChinahasalonghistoryoffreshwateraquaculture.In2004,outputofinland

aquaculturewas18,9milliontonnes.Ininlandaquacultureoutputfinfishcontributed

17,2milliontonnes,or91%oftotaloutput.

In2004therewere8754fishprocessingplantsinChina.totalprocessedaquaticproduct

amountedto13,8milliontonnes.

ChinaandNorwayarerankedastheworldlargestandsecondlargestexportersof

seafood,respectively.Chinaplaysanimportantroleintheglobalproductionandtradein

fishandfisheriesproducts.In2006,China’sexportsoffishandfisheriesproductsreached

3milliontonnesvaluedus$9.4billion,anincreaseofrespectively17.4%and18.7%over

thelastyear.Astheworld’sfourthlargestimportmarketoffishandfisheryproductsat

present(euisconsideredasasinglecustomsterritory),China’simportsinthesecatego-

ries,mainlyfromeasterneurope,southAmerica,Japan,AustraliaandNewZealand,are

nowgrowingmorerapidlythanitsexports.In2006,China’simportsinthiscategory

reached3.3milliontonnesvaluedus$4.3billion.

thevalueofNorwegianexportsrepresentsaroundus$5.6billionperyear,andsupplies

majormarketsallovertheworld,ofwhichtheeuropeanunion,therussianandtheJapa-

nesemarketsarethemostimportant.fishexportsareNorway’ssecondlargestexport

commodity.salmonandtroutexportsaccountforalmosthalfoftheexportvalue.Other

importantcategoriesoffishproductsareherringandmackerel,traditionalproductslike

driedandsaltedfish,frozenandfilletedfish,andotherprocessedproducts.

Inthelastyears,tradeinfishandfisheriesproductsbetweenChinaandNorwayhas

substantiallyincreased.In2006,thetotaltradevalueinthissectorreachedus$190.2

million.

Table 2-13 Bilateral Trade of Marine Products14 between China and Norway

(US$ million)

SITC 03 2001 2002 2003 2004 2005 2006

China’sexports 3.8 2.4 4.9 6.7 12.6 23.1

Norway’sexports 54.8 78.9 97.6 126.6 171.1 167.1

totalvalue 58.6 81.3 102.5 133.2 183.7 190.2

source:statisticsNorway.

frozenmackerel(hs03037400),frozencod(hs03036000),frozenfish,nes(hs

03037990),frozenhaddock(hs03037200),andAtlanticsalmon(hs03021210)are

themostimportantfisheriesproductsChinaimportsfromNorway.Norway’sexport

14 marineproductsrefertothecommoditiesunderthedivision03ofsItC,includingfish,crustanceans,molluscsandaquaticinvertebrates,andpreparationthereof.


ofsalmontoChina,whichstartedin1998,hasbeengrowingveryrapidly.Atpresent,

ChinaisthetenthbiggestimporterofNorway’ssalmonandthebiggestoneintheAsian

market.About90%oftheimportedAtlanticsalmononChina’smarketcomesfrom

Norway.ConsideringtheupgradingofChinesecitizens’consumptionlevelandthehuge

domesticmarketofChina,Norway’sexportsofsalmonandothertopgradefishand

fisheryproductstoChinaareexpectedtogrowcontinuouslyinthefuture.

Table 2-14 China’s Main Marine Products Imports from Norway (2006)

(US$ million)

Frozen mackerelFrozen cod (excl.

livers & roes)Frozen fish, nes Frozen haddock Atlantic Salmon

73.4 27.2 26.3 23.3 22


China’simporttariffsforfisheriesproductshavedroppedfromapre-WtOaccession

averageof15.3%to11.0%in2005.thehighesttariffrateforafisheriesproductwas

23.6%in2005.17items,accountingfor10%ofalltheimportedfisheriesproducts,are

exemptfromtariffs.

AreasonfortheincreaseoftheNorwegianexportistheincreaseintheconsumption

ofseafoodinChina.AnotherreasonisincreaseddemandforrawmaterialstoChina’s

growingfishprocessingindustry.theprocessedproductsarere-exportedmainlyto

Japanandtheeuropeanunion.thegrowingdemandfromChineseconsumersandthe

processingindustryhasmadeChinaintoaworldleadingproducerandexporteroffish

andfisheriesproducts.

today,NorwegianexportersoffishandfishproductstoChinaarefacingtariffsbetween

10and18%,dependingonthespeciesandlevelofprocessing.Withtheexceptionofa

verylimitednumberoflines,Norway’sfinalboundrateonfishandfishproductsiszero.

removingtariffsandotherbarrierswillfacilitatetradeinfishproducts,resultingin

economicbenefitstobothcountries.therewillbebenefitsfortheconsumersofboth

countriesintheformoflowerpricesandaccesstoawiderrangeofproducts,andthe

improvedopportunitiesaffordedtoexportersthroughaccesstomarketswillinturn

stimulategreatereconomicactivityinbothcountries.technologyandinvestment

exchangesthataccompanytheflowoffishproductswillalsoleadtoproductivitygains.

theeliminationorsubstantialreductionofChina'simporttariffoffishandfishery

productswillpossiblyincreaseNorwegianexporttoChina.takingintoaccountfishery

products'natureofreplacement,thismighthaverelevantimpactonChina'sfishery

productionandfisherman'sincome.Inthisregard,thesesensitivitiesshouldbetaken

intoaccount.


Infebruary2006,thegovernmentofChinaissuedaProgramme of Action on Conserva-

tion of Living Aquatic resources of China.Itaimstoreversethetrendofdeteriorationofthe

aquaticenvironment,declineoffisheriesresourcesandtheincreasingnumberofendan-

geredspecies,reduceovercapacityandimprovetheefficiencyoffishingoperationsand

economicbenefits.Accordingtothisprogramthecatchwillfallfrom13.1milliontonnes

in2002to12milliontonnesin2010.

thedifferentaspectsoftradeliberalisationinthefisheriessectordescribedabove

shouldbeaddressedinthefutureftAnegotiations.

bilateraltradeinfishandfishproductsbetweenthetwocountriesiscontinuouslydevel-

oping.Afreetradeagreementwillcontributepositivelytothefurthercooperationand

developmentofthefisheriesandaquacultureindustriesinbothcountries.

2.3.6 Agriculture products

Chinaisoneofthebiggestagricultureproductproducersintheworld,withthe

productionofseveralkindsofprimaryagricultureproductsrankingthefirst,suchas

cotton,pork,poultry,fruitsandvegetables.Chinaalsoplaysakeyroleintheinterna-

tionalagricultureproductstrade.Atpresent,Chinaistheworld’sfourthlargestimporter

andthefifthlargestexporterofagricultureproducts.lateststatisticsfromministryof

Agricultureshowthatthetotalvalueofagricultureproducttradereachedus$63.5

billionin2006,ofwhich,exportaccountedforus$31.4billion,importaccountedfor

us$32.1billion.

Asahigh-cost,low-potentialactivity,agriculturalproduction,especiallythegrain

productioninNorwayhasbeenlargelydependentondirectandindirectgovernment

support.thisisi.a.dictatedbyfactorssuchastheharshclimateanddifficulttopog-

raphy,sincealmost3/4thofNorway'slandisunproductiveandlessthan4%isunder

cultivation.Atpresent,theagricultureproductionofNorway,whichisdominatedby

stockbreeding,contributeslessthan2%tothegdpofthecountry.Althoughalmost

beingself-sufficientinmeat,poultryanddairyproducts,Norwayimportsmorethan

50%ofitsfoodproducts.

In2006,agricultureaccountedforanemploymentofabout63,000man-yearorlessthan

3%oftotalemploymentinNorway.however,thefarmsectorisstillveryimportantin

manymunicipalitiesinNorway.

thefoodindustryisresponsibleforalargeshareofthefoodbeingprocessed.thesector

playsasignificantrolewithregardtovaluecreation,employmentandasabuyerand

processorofagriculturalcommodities.thefood,beverageandtobaccoindustryisthe

secondlargestindustrialsectorinNorway,surpassedonlybytheengineeringindustry.


thedegreeofself-sufficiencyandtheshareoffoodconsumptionproducedbyNorwe-

gianagricultureisaround50%.exportisinsignificantforallproductsexceptcheese.this

illustratesthatNorwegianagriculturalfoodproductionisaimedatthedomesticmarket.

Importsarehighestforthosecommoditiesthatcannotbeproducedinsufficientquanti-

tiesduetothenaturalconditions.theseareprimarilysugar,rice,fruits,vegetables,wine

andspirits.

theimportsofagriculturalgoodsaresteadilyrisingandin2006theimportvalue

exceededus$3.9billion.

Diagram 2-2 Imports of agricultural goods to Norway (Million USD)


thebilateraltradeofagricultureproductsbetweenChinaandNorwayhasbeen

witnessingarapidgrowthinrecentyears,notonlyinvalueandquantity,butalsoin

productcategories.themainagricultureproductsChinaexportstoNorwayinclude

fruits,vegetables,grains,sugarandhoney,whileanimalfoodstuffsdominateNorway’s

exportstoChinainthesecategories.In2006,thetotaltradevalueofprimaryagriculture

productsbetweenChinaandNorwayreachedus$27million,amongwhichChina’s

exportstoNorwayamountedtous$24.5million,andNorway’sexportsto

Chinareachedus$2.5million.

Table 2-15 Trade of Primary Agriculture Products* between China and Norway

(US$ million)

China’s exports Norway’s exports

2001 8.2 0.7

2002 9.5 1.9

2003 12 1.4

2004 18 1.9

2005 20 2.3

2006 24.5 2.5

*fishandfisheryproductsareexcludedfromprimaryagricultureproducts.source:statisticsNorway.

0

500

1000

1500

2000

2500

3000

3500

4000

LDC

GSP

EU

Other countries

2006200520042003


Withregardtotheimportregimeforagriculture,Norwaymaintainsacomparatively

highlevelofprotection,butthetariffstructureisnotsotransparentduetotheexten-

siveuseofspecifictariffs,i.e.tariffsexpressedinNOK/kgorthelike,whichconstitutesan

importantimpedimenttotheexportofChina’sagriculturalproducts.Atpresent,28%

ofNorway’starifflinesinagricultureareabove100%,and10%areabove300%.based

onWtOcalculations,theaverageofmfNappliedtariffsis39%.theleastdeveloped

Countrieshavezerotariffs,otherdevelopingcountriesobtain10–15%tariffreductions

comparedtothegeneraltariffsunderthegspsystemoftariffpreferences.tariffrate

quotasprovidesomeincreaseinmarketaccess.

theaveragetarifflevelofChinaforagriculturalproductsis15.2%in2006.Amongallthe

tariffitemsofagriculturalproducts,81areexemptfromduty,andthehighesttariffrate

is65%.tariffsinthe0–20%rangeareimposedon76%ofalltheimportedagricultural

products.Currently,ChinaappliestrQsonanumberofagriculturalproducts,including

wheat,maize,rice(whetherornotbusked),sugar,wool,wooltopsandcotton.

thebilateralagriculturaltradebetweenChinaandNorwayiscomparativelylimitedat

present.thefutureftAmustcontinuetogiveopportunitiesforagriculturalproduc-

tioninNorwayandChina,butatthesametimecreatenewpossibilitiestoenlargethe

bilateralagriculturaltrade.removingandreducingtariffsandotherbarriersinagricul-

turaltradewillallowthetwocountriestosharethepotentialbenefitsfromliberalisa-

tion,includinglowerpricesandaccesstoawiderrangeofagriculturalproductsfor

consumers,andimprovedopportunitiesforexportersthroughimprovedaccessto

markets.Apartfromthat,theftAwillalsopromoteagriculturaltechnologycooperation

andexchangebetweenChinaandNorway,thusimprovingtheagriculturalproduction

ofthetwocountries.

thedifferentaspectsoftradeliberalisationintheagriculturalsectordescribedabove

shouldbeaddressedinthefutureftAnegotiations.

2.4 Overall impact of liberalizing trade in goods

thestudyhasdemonstratedthatChinaandNorwayenjoytoalargeextentcomplemen-

taritiesintheirgoodstrade.however,arangeoftariffandnon-tariffbarrierscurrently

impedesbilateraltrade.tariffbarriersaretheeasiesttoquantifyandeliminate.Non-tariff

barriersareofamuchgreatervarietyandincludenotonlyissuesregardingproduct

standardsandcross-borderformalitiesandprocedures,butalsoissuesonimplementa-

tionoflawsandregulations.liberalisinggoodstradebyaddressingbothtariffsandnon-

tariffmeasureswillbeakeycomponentofthefutureftAbetweenChinaandNorway.

Inbroadterms,theliberalisationoftradeingoodswillpromotetheeconomicdevelop-

mentofChinaandNorway,asaresultofproductivityimprovementslinkedtoincreasing

competitionandopportunitiestoexploiteconomiesofscaleinthelargermarket,and


re-allocationofresourcesbetweenindustriesassociatedwithincreasingproductspecial-

isationinlinewithcomparativeadvantage.therefore,thebenefitsbroughtaboutby

theftAwouldincludelowerpricesandincreasedchoiceofconsumergoodsandinputs

intoproductionprocesses,andimprovedmarketaccessopportunitiesforexporters.

morespecifically,anftAwouldexpandbilateraltradeinareaswhereeachcountry

hascomparativeadvantage.InthecaseofNorwaythiswouldincludefishandmarine

productsaswellastechnologicalproductsrelatedtothefisheriesindustry;petroleum

andgasrelatedproductsincludingtheupstreamsupplyindustryaswellasthechemical

productsofthedownstreamindustry;andmetals,machineriesandequipmentforthe

Chineseconstructionandshipbuildingsectors.InthecaseofChinalabourintensive

manufacturessuchastextileandapparel,machineryandelectronicequipments,aswell

asprimaryagricultureproductsareimportant.thesectoralsurveysoftradeinmachinery

andelectronicequipment,textilesandapparel,petroleumandchemicals,metals,fish

andfisheryproducts,andprimaryagricultureproductsillustratesomeofthenetbenefits

ofexpandingmarketaccessforgoodsbetweenChinaandNorway.

AnftAwouldbeexpectedtoeliminatealltariffsonindustrialgoodsbetweenChina

andNorwayasearlyaspossibleandmaketariffeliminationandreductionsforagricul-

turalproducts,whileensuringthatnon-tariffmeasuresarenotmoretrade-restrictive

thannecessarytofulfillegitimatenationalpolicyobjectives.theimpactofanftAon

theindustrialandagriculturalsectorsinbothcountrieswillalsodependontherespec-

tivestrengthsandcomparativeadvantagesofthesesectorsinChinaandNorway.In

thissense,thepotentialimpactsoffurtherliberalisationofgoodstradeonbothcoun-

triesindifferentsectorsshouldbetakenintoaccountinfutureftAnegotiations.the

possibilitiesfortradeliberalisationaswellassensitivitiesinindividualsectorsshouldbe

addressedinthefuturenegotiations.

Annex 1

The Exchange Rate of Norway’s Krone used in this study

(US dollar)

2001 2002 2003 2004 2005 2006

NOK 8.99 7.98 7.08 6.74 6.44 6.41

Note:directquotation,perusdollar.source:Imf,Internationalfinancialstatistics,2001-2006.

49

Chapter three: Impact of trade liberalisation on services

tradeinservicesisbecominganincreasinglyimportantelementoftheoverallbilateral

economicrelationshipbetweenChinaandNorway.thischapterprovidesanoverview

ofregulatorymeasuresaffectingtradeinservicesbetweenthetwocountries,andhigh-

lightstheopportunitiesandchallengesofservicestradeliberalisationthrough

apossiblebilateralftA.

3.1 An Overview of Chinese Trade Policies Applying to Services

Whileenjoyingrapidandstableeconomicgrowthinrecentyears,Chinahasrestructured

itseconomytoincreasetheweightofitsservicesector.Nevertheless,theproportion

oftheservicessectorasapercentageofgdpinChinaismuchlowerthanthatinmost

developedcountries.bytheendof2005,theserviceindustryaccountedforabout41%

ofChina’sgdp.themajorservicesactivitieswerewholesaleandretailtradeandcatering

services(about24%ofthetotal),financeandinsurance(17%),andsocialservices(13%).

Atpresent,theemploymentintheservicesectorsaccountsforabout31.5%ofChina’s

totalemployment.

China’stradeinserviceshascontinuedtomaintainasteadyrateofgrowthinrecent

yearsofapproximately15%annually.lateststatisticsfromtheministryofCommerceof

Chinaindicatethatin2006,thetotalvolumeofChina’sservicestradereachedus$191.8

billion,ofwhich,exports(orrevenue)accountedforus$91.4billion,imports(orexpense)

accountedforus$100.3billion.Atpresent,China’sservicesimportsandexportsrank7th

and8thintheworldandcomprise3.8%and3.2%respectivelyoftheworld’stotalserv-

icesimportsandexports.

In2006China’simportsandexportsofservicesmainlyconcentratedontravel,

transportationandotherbusinessservices,whichaccountedfor30.4%,28.9%and

16.1%respectivelyofthegrossimportsandexportsvolumeoftradeinservices,

andtogethertheyaccountedfor75.4%ofthetotal.thesharesoffinance,and

communicationsservicesweremuchsmaller,accountingfor0.5%and0.8%respectively

ofthegrossimportsandexportsvolume.thiswasattributabletotherelativelarge

importandexportscaleofChina’stradeingoods.thetraditionalsectorsoftradein

servicesthataredirectlyrelatedtoimportsandexportsofgoodshavedevelopedbetter,

whilethetechnologyandknowledge-intensivesectorswithhighaddedvaluesuchas

I m pA C t O f t r A d e l I b e r A l I s At I O N I N g O O d s50 I m pA C t O f t r A d e l I b e r A l I s At I O N O N s e r V I C e s50

financing,insurance,consultancy,computerandinformationserviceswerestillatthe

initiatingstagewithweakinternationalcompetitiveness.

travel,transportation,otherbusinessservices,consultancy,computerandinformation

servicestookthelargestshareinexportsofservices,rankingtopfiveinexportsof

servicesrespectively;transportation,travel,otherbusinessservices,insuranceand

consultancyarethetopfiveimportedservicesrespectively.

Table 3-1 China’s exports of services 2004–2006 (US$ Million)

Description Year % Change

＝ 2004 2005 2006 2006/2005

services(total) 62055 73909 91419 23.7

transportation 12067 15427 21015 36.2

travel 25739 29296 33949 15.9

Communicationservices 440 485 738 52.2

Constructionservices 1467 2593 2753 6.2

Insuranceservices 381 549 549 0.0

financialservices 94 145 145 0.0

Computerandinformationservices 1637 1840 2957 60.7

royaltiesandlicensefees 236 157 204 29.9

Consulting 3153 5322 7834 47.2

Advertising,publicity 849 1076 1445 34.3

film,audiovisual 41 134 137 2.2

Othercommercialservices 15951 16885 19693 16.6

source:balanceofpaymentsofChina,excludinggovernmentservices.

r e p O r t N O r WAy – C h I N A 51r e p O r t N O r WAy – C h I N A 51

Table 3-2 China’s imports of services 2004–2006 (US$ Million)


＝ 2004 2005 2006 2006/2005

services(total) 71602 83173 100326 20.6

transportation 24544 28448 34369 20.8

travel 19149 21759 24322 11.8

Communicationservices 472 603 764 26.7

Constructionservices 1339 1619 2050 26.6

Insuranceservices 6124 7200 8831 22.7

financialservices 138 159 891 460.4

Computerandinformationservices 1253 1623 1739 7.1

royaltiesandlicensefees 4497 5321 6634 24.7

Consulting 4734 6184 8389 35.7

Advertising,publicity 698 715 955 33.6

film,audiovisual 176 154 121 -21.4

Othercommercialservices 8478 9388 11261 20.0

source:balanceofpaymentsofChina,excludinggovernmentservices.

sinceChina’saccessiontotheWtO,theChinesegovernmenthastakeneffectivemeas-

urestoliberalizetheservicesmarket.AllthemarketaccesscommitmentsintheWtOin

thefieldoftradeinserviceshavebeenimplementedthroughtherevisionandadoption

ofsector-specificlaws,administrativeregulationsanddepartmentrules.thelevelof

marketaccessforforeignservicessuppliershasbeensignificantlyincreased.bytheend

of2006,Chinahasopenedmorethan100servicessectors,accountingfor62.5%ofthe

WtO’sservicesectoralClassificationlist(W/120).ConsideringChina’sstatusasadevel-

opingeconomy,theservicesmarketofChinaisquiteliberalised.Currently,Chinaisposi-

tivelyparticipatingintheWtOddAnegotiationsonservicesandmakesnewcommit-

mentsinbusinessandtransportservices.

theprovisionsintheProtocol on the Accession of the People’s Republic of Chinatothe

WtOhaveestablishedtheprimaryprinciplesinwhichChinalegislatesintheservices

sector,includingdetailedregulationsoncommercialpresenceandmovementofnatural

persons.Aseriesofnewlawsandregulationsrelatedtoserviceshavealsobeenpromul-

gatedsinceChina’saccessiontotheWtO,suchasRegulations on Representative Offices of

Foreign Law Firms in China, Regulation on Chinese-foreign Cooperation in Running Schools,

Regulations on Management of Telecommunication Enterprises with Foreign Capital, Regula-

tions on Financial Institutions with Foreign Capital, Regulations on Insurance Company with

Foreign Capital, Regulations on International Maritime.furtherliberalisationofservicesin

Chinaisanticipatedtocontinueinaprogressiveandmanageableway.


Inrecentyears,Chinahasalsobeenmakinggreateffortstopromoteservicestrade

liberalisationundertheframeworkofregionalandbilateraleconomiccooperation.The

Agreement on Trade in Services of the Framework Agreement on Comprehensive Economic

Co-Operation between China and ASEANwassignedinJanuary2007,whichisthefirst

agreementontradeinservicesunderaftAframeworkbetweenChinaandothercoun-

tries.ChinaandtheAseANcountrieswillfurtheropentheirservicessectors,providing

improvedmarketaccessforeachotherfollowingtheagreement.undertheagreement,

Chinahasmadefurthercommitmentsforliberalisationinbusinessservices,construction

andrelatedengineeringservices,environmentalservices,culturalandsportingservices,

andtransportservicestotheAseANcountries.sincethelaunchoftheCepAswithhong

Kongandmacaoin2004,twenty-sevenservicesectorsonthemainlandofChinahave

beenopenedtohongKongandmacao.forty-fourcitiesonthemainlandhavestarted

individualtouristbusinessesfortraveltohongKongandmacao.Over1400individuals'

professionalqualificationintheareasofconstruction,accountingandmedicalservices

havebeenmutuallyrecognizedbetweenthemainlandandhongKong.besides,the

concludedandunder-negotiationftAsbetweenChinaandChile,Australia,NewZealand,

singaporeandIcelandalsocovertheissueofservicestradeliberalisation.

3.2 An overview of Norwegian trade policies applying to services

todaythemajorityofNorway’sworkforceisemployedintheservicesectorandthe

servicesector’sshareofthegdpis56,3%.Norwayisdependantonbuyingadvice,infor-

mation,leisureactivities,transportandotherservices.goodsandserviceproductionis

connectedthroughvaluechains.goodsarenotjustproduced;theyarealsodeveloped,

designed,marketed,soldandtransported.manyNorwegiancompaniesoperatesuccess-

fullywithinseveralaspectsofthisvaluechain.Ahighlyskilledworkforceisakeyresource

formostofthem.

Althoughthestatehasreduceditsshareholdingsinanumberofenterprises,state

ownershipintheservicessectorremainssubstantial,particularlyinfinancial,telecom-

munication,healthandculturalservices.

In2006,Norwayexportedservicesforapproximatelyus$31billion.Allinall,servicesare

oneofNorway’smostimportantexports,accountingforjustlessthanonequarter(22%)

ofNorway’stotalexports.

theNorwegianservicesindustryhastoalargeextentdevelopedinresponsetothe

needtoutiliseNorway’srichnaturalresourcesandovercomethechallengesposedby

aharshclimateanddifficultgeography.longwinters,difficultterrain,andtheworld’s

harshestseasallhavetobeovercome.thisrealityisreflectedinthecompositionof

theNorwegianservicessector.fieldswhereNorwegianfirmshavespecialisedinclude


marinetechnology,shipping,hydropower,mineralresourcesengineering,aquaculture,

thefisheriesindustry,forestry,andtheoilandgasindustry.

Norwegianserviceproviders,beingtechnologicallyadvanced,arealsocompetitivein

hightechindustriessuchassoftwareandcommunicationstechnology,space-related

technology,theengineeringindustry,andbiotechnology.

theshippingindustryaccountsforroughlyhalfofNorwegianservicesexports(2006).

Norwayiseurope’smostdiversifiedmaritimenationandcommandsworldwiderespect

foritsshippingexpertise,equipmentandabilitytoexploitnewmarketniches.Norway’s

overallmaritimeeconomy–anexpandingclusterofindustrieslinkedtoshippingand

theaquacultureindustry–encompassesanincreasinglywidevarietyofproductsand

services.Norwayaccountsfornearly10%oftheglobalshippingfleet,andhasoneofthe

largestmerchantfleets.

thesecondlargestNorwegianservicesexportis“otherbusinessservices”andfinancial

services.Norwegianfirmsexportanincreasingnumberofservices,inareasasdiverseas

financeandinsurance,legalandauditingservices,marketingandpublicrelations,and

managementconsulting.

Whenitcomestopetroleumresourceextraction,Norwayisaworldleaderinboth

thetechnologicalandenvironmentalfields.theoilandgasindustryaccountsforthe

majorityofNorwegianexportearnings,andthespin-offeffectsboostinnovationand

technologicaldevelopmentinotherNorwegianindustrysectors.forexample,Norway

hassomeoftheworld’sforemostexpertisewhenitcomestosubseatechnology.

duetoitsmountainousterrain,Norwayhasdevelopedengineeringexpertiseincreating

undergroundfacilities,includinghydropowerplants,oilstoragefacilities,watertreat-

mentworks,undergroundstations,militaryinstallationsandsportsfacilities.Nearlyhalf

oftheworld’s400undergroundpowerplantsarelocatedinNorway.roadconstruction

inacountryofmountainsandfjordsisalsoachallenge,andNorwegiangeologicalengi-

neershaveovertimedevelopedgreatexpertiseincavernexcavation,bridgeconstruc-

tion,knowledgeofrockproperties,geologicalanalysis,drillingandblasting.

Norwegianbuildingandconstructionindustryhasattractedinternationalattentionfor

itsinnovativedesignandexceptionalproducts.Norwegianarchitectshavewoninter-

nationalacclaimfortheirmodernapproachtotraditionalmaterialssuchaswood,stone

andmetal.


Table 3-3 Norwegian exports of services 2004–2006 (US$ million)


2004 2005 2006 2006/2005

services(total) 22731,1 27564,4 31103,3 12,8

transportation 12522 14477,9 14382,2 -0,7

travel 2681,3 3133,8 3413,0 8,9

Communicationsservices 289,3 355,6 367,0 3,2

Constructionservices 104,4 238,7 351,2 47,1

Insuranceservices 301,2 320,8 303,4 -5,4

financialservices 534,8 689,9 717,2 4,0

Computerandinformationservices 509,2 845,5 1170,6 38,4

royaltiesandlicensefees 217,7 492,9 718,2 45,7

Otherbusinessservices 5136,5 6478,8 9037,6 39,5

personal,culturalandrecreationalservices 166,4 330,1 440,6 33,5

governmentservices,n.i.e. 268,3 200,3 202,2 0,9

sourceofdata:Imf

Norwayimportedservicesin2006forapproximatelyus$30billion.thelargestNorwe-

gianservicesimportsaretravel(accountedforroughlyonethirdofservicesimportsin

2005),shippingrelatedservices,businessservicesandfinancialservices.

Norwegianservicesimportsaregrowingbyanaverageofalmost10%annually

(2003–2006).thelargestincreasesarefoundinoil-relatedservicesandinthetravel

industry.someofthegrowthisfuelledbytheeuexpansion,withserviceproviders

enteringthecountryfreelyfromtheneweumembers,combinedwithincreased

demandforforeignlabour,particularlyintheconstructionbusiness.

Table 3-4 Norwegian imports of services 2004–2006 (US$ million)


2004 2005 2006 2006/2005

services(total) 21868,4 27793,2 29600,8 6,5

transportation 7610,6 8975,2 8841,2 -1,5

travel 7638,3 9577,1 10767,9 12,4

Communicationsservices 209,8 268,5 282,5 5,2

Constructionservices 35,3 39,0 46,5 19,1

Insuranceservices 395,3 392,0 137,5 -64,9

financialservices 1061,9 1163,6 1117,6 -4,0

Computerandinformationservices 515,1 1063,4 1135,9 6,8

royaltiesandlicensefees 397,9 437,7 522,1 19,3

Otherbusinessservices 3269,7 4698,4 5496,7 17,0

personal,culturalandrecreationalservices 345,0 490,1 563,0 14,9

governmentservices,n.i.e. 389,5 688,0 689,6 0,2

sourceofdata:Imf


Trade in services in the WTO

NorwayhasmadespecificcommitmentsunderthegAtsinallservicecategoriesexcept

audiovisuals,health-relatedandsocialservices.Norwayhasbound–withafewlimita-

tionsonmarketaccessandnationaltreatment–measuresaffectingcross-bordersupply,

consumptionabroad,andcommercialpresenceforanumberofservices,including

telecommunications,constructionandrelatedengineeringservices,anddistributionand

transportservices.Norwayhasanopenandliberalregimewithrespecttocommercial

presence.measuresaffectingpresenceofnaturalpersonsremaingenerallyunbound,

exceptasindicatedunderNorway’shorizontalcommitments.Intheongoingservices

negotiations,Norwaygenerallygivesprioritytoclosingthegapbetweenexistinglevels

ofliberalisationandtheboundcommitmentsinthegAts.sectorally,Norwaygives

prioritytoameaningfulliberalisationandfullintegrationofmaritimetransportservices

inthegAts,andtocommitmentsforenergyservices,telecommunicationservices,finan-

cialservices(especiallymarineandenergyinsurance),computer,construction,architect

andengineering,environmental,legalandairtransportservices.Norwayhasofferednew

commitmentsinanumberofservices,anexpansionofthescheduleofhorizontalaswell

assector-specificcommitments,alreadyimplementedattheeeAlevel.

Trade in services under the EEA Agreement

AccordingtotheeeAAgreementArticle3,4,31–39,restrictionsonthefreemovement

ofservicesandthefreedomofestablishmentofnationalsofaneCmemberstateoran

eftAstateintheterritoryofanyotherofthesestates,isprohibited.AnnexesVIII-XIofthe

eeAAgreementcontainspecificprovisionsontherightofestablishmentandAnnexes

IX-XIcontainspecificprovisionsonthefreedomtoprovideservices.

Trade in services in Norway’s free trade agreements

InlinewithNorway’sactiveinvolvementinotherinternationalfora,theNorwegianeftA

ftAsnowincludeprovisionsfortheliberalisationoftradeinservices.Inthemoreambi-

tiousagreements,thesecoverallmodesofservicesupplyandcontainseparatesections

orannexesrelatingtospecificsectors,e.g.financialservicesandtelecommunications.

theybuildonthegeneralAgreementontradeinservices(gAts)andfollowasimilar

approach,complementedbyenhancedspecificcommitments.

Norway’seftAftAswitheuropeanandmediterraneancountriesallcontainanevolu-

tionaryclauseonservicesandinvestmentwiththeaimofachievinggradualliberali-

sationandthemutualopeningofmarketsforinvestmentsandtradeinservices.


3.3 Current trends of trade in services between China and Norway in specific sectors

3.3.1 Air transport services

Afterthelaunchofthereformandopening-updrive,China’scivilaviationindustry

enteredanewperiodofsustainedandrapiddevelopment.today,ithasformedan

airtransportnetworkradiatingtovariousdirectionsandlinkingmaincountriesand

regionsaroundtheworld.Accordingtothe11thfive-yearplan,airtransportservices

areexpectedtogrowatananuallyrateover12%atleastuntil2010,andthevolumeof

airtransportinChinaispredictedtobeasmuchasfivetimesitscurrentlevelby2022.

themainagencyresponsibleforthegovernanceofthecivilairtransportsectoristhe

generalAdministrationofCivilAviationinChina(CAAC).

AccordingtoChina’sWtOcommitments,foreignservicessuppliersarepermittedto

establishjointventureaircraftrepairandmaintenanceenterprisesinChina.theChinese

sideshallholdcontrollingsharesorbeinadominantpositioninthejointventures.

licensesfortheestablishmentsofjointventuresaresubjecttoaneconomicneedstest.

furthermore,withregardtorelatedlawsandregulations,foreignownershipofChinese

airlinesispermittedupto49%whileasingleforeigninvestor’sshareshouldbenomore

than25%.

theAgreementonCivilAirtransportbetweenthegovernmentofthepeople’srepublic

ofChinaandthegovernmentoftheKingdomofNorwaywassignedin1973andhas

subsequentlybeenamendedseveraltimes.thishasgreatlyfacilitatedthefriendly

contactsbetweenthepeoplesofNorwayandChina.Inrecentyears,airlinksbetween

Chinaandscandinaviahaveseenrapidgrowth.furtherstrengtheningbilateralcoopera-

tiononairservicesundertheframeworkoftheftAwillbeinstrumentalinsupporting

thecross-bordertrade,investmentandtourismgrowth.

3.3.2 Maritime transport services

maritimetransportisagrowthindustry,whichisexpandingwithincreasedtradein

goodsandglobalization.AccordingtouNCtAdfiguresthemaritimetransportvolume

grewby52%from1990to2005and13,5%from2000to2005.

themaritimetransportindustryisatrulyglobalactivitywithinternationalrulesfor

safety,security,environmentandsocialconditionsthroughtheInternationalmaritime

Organization(ImO)andtheInternationallabourOrganization(IlO).thisindustryis

basedoninternationaldivisionoflabourwherethefactorsofproductionsuchasships,

equipment,crew,financing,insuranceandclassificationaresourcedininternationaland

competitivemarkets.


maritimetransportisanimportantfacilitatorofworldtrade.morethanfour-fifthsof

worldtradebyvolumeiscarriedbysea.morethanpurelyafacilitator,maritimetransport

isalsoasignificantexportableserviceinmanycountriesincludingNorwayandChina,

andmakedirectcontributionstothenationalgdp.Inviewofitsimportance,forNorway,

substantiveliberalisationofthemaritimetransportservicesectorisessentialalsoin

multilateralandbilateraltradenegotiations.

Accesstoaglobalnetworkofreliable,efficientandcost-effectivemaritimetransport

servicesisbeneficialtoalleconomies.restrictionsonmaritimetransportservicescan

adverselyaffectanumberofeconomicfactors,includingexportandimportprices,and

thelocationofforeigndirectinvestment.liberalisationisthekeytoreducingmaritime

transportcosts,providinggreaterchoicestoshippers,andensuringfastandefficient

deliveries.liberalisationinthesectorwillalsoencourageforeigninvestment,which

willnotonlyenhanceemploymentopportunitieswithinthesectoritself,butwillalso

promotethegrowthofotherrelatedservicesectors.themultipliereffectofthemaritime

transportservicesectorextendstoactivitiessuchasshiprepairandmaintenance,ship

classification,distribution,professionalservices,communicationsandbankingandinsur-

anceservices.

Norway

maritimetransportisanimportantsectorforNorway.theNorwegianfleetranksno6

intheworldandiscomprisedof1665vesselsmeasuring45milliondeadweighttons

(dwt)accordingtouNCtAdfiguresfrom1January2006.halfofthevalueofNorwegian

exportsofservicesisrelatedtomaritimetransport.theNorwegianfleetemploysome

58000seafarersofwhom20000areNorwegiansand38000foreigners.

NorwegianshippingcompanieshavediversifiedinterestsintheChinesemarkettrans-

portingavarietyofcargoesespeciallybyro-roandbulkvesselstoanumberofports.

thenumberofshipcallstoChineseportsbyNorwegianvesselstotalled1000in2005.

thismakesChinaanimportantmarketforNorwegianship-owners.someNorwegian

shippingcompanieshaveestablishedpresenceinChinaintheformofrepresentative

offices,jointventuresorwhollyownedcompanies.

thelasttenyears,Norwegianshippingcompanieshaveacquired50vesselsfrom

Chineseshipyards,andtheyhaveasofAugust200746vesselsonorderinChina.

theNorwegianshipowners’Association(NsA)hasformanyyearsco-operatedwiththe

Chinesegovernment,theChinashippinggroupandtheshanghaimaritimeAcademy

oneducationandrecruitmentofChineseseafarers.thiscooperationhasyieldedsuccess

andcurrentlysome1200ChineseseafarersareemployedonvesselsownedbyNorwe-

gianship-owners.theNorwegianshippingcompanieswouldliketobeabletooperate

asmanningagentsinChina,orsecondarily,tobemoreactivelyinvolvedintheChinese

manningagentsbusinesstosecuretheChineseseafarers’interests.


China

themaritimetransportserviceindustryofChinahasbeendevelopingveryquicklyin

recentyears.by2005,China'sfleetwastheworld'sfourthlargestintermsofcarrying

capacityanditscontainerfleetrankedthefifth.thecountryplanstomakeitsocean-going

fleetthethirdlargestintheworldby2010.thetotaldeadweighttonnageofChinese-flag

flyingoceanvessels,whichis44millionatpresent,willreach100millionby2010.

theministryofCommunications(mOC)isinchargeofformulatingshippingandport

policies.thegoalsofChina’sshippingandportpoliciesincludeestablishingacompeti-

tivemaritimetransportmarket;buildingupaninternationallycompetitivecommercial

fleet;andformingamulti-functionalportsystem,takingintoconsiderationeconomic

developmentandsecurityconcerns.deregulationandreformmeasuresinthesector

includeupdatinglegislationinaccordancewithChina'sWtOcommitments,soliciting

opinionsfromforeignanddomesticenterprises;relaxinggovernmentcontrolon

domesticshippingenterprises;andencouragingforeignparticipationintheinter-

nationalshippingbusiness.

AccordingtorelatedregulationsofChina,foreignservicessuppliersarepermittedto

establishjointventureshippingcompanies.foreigninvestmentshallnotexceed49%

ofthetotalregisteredcapitalofthejointventure.theChinesesideshouldappointthe

chairmanofboardofdirectorsandthegeneralmanagerofthejointventure.

AbilateralagreementofshippingbetweenChinaandNorwaywassignedindecember

2004inshanghai,China.theagreement,whichincludes,amongotherissues,regulations

forhiringcrewandadherencetointernationallaw,isanimportantadditiontothetwo

countries'levelofcooperation.theNorwegianshippingindustryisheavilyinvolvedin

ChinaandtheagreementwillensurebetteraccesstotheChinesemarketsandmore

preferabledealsforNorwegiancompanies.AnftAbetweenChinaandNorwaycould

provideconsiderablescopeforfurthercooperationandmutualbenefitintheareaof

maritimetransportservices.

3.3.3 Energy services

Athrivingenergysector–includingenergyservices–istodayrecognisedasabasic

elementofeconomicwell-being.theavailabilityofvariedsourcesofenergyatcompeti-

tivepricescontributestoanation’sabilitytocompeteintheworldmarketplace.thereis

ahighcorrelationbetweenrisingormoreefficientenergyusageandeconomicgrowth,

increasedlifeexpectancy,andhigherstandardsofliving.moreover,modernenergy

servicesprovidethemeanstodevelopenergyresourcesinanenvironmentallysound

mannerandinwaysthatpromoteresponsibleandefficientdevelopmentanduseof

energyresources.


thereisalreadyasubstantialdegreeofcooperationbetweenNorwayandChinainthe

energyfield,mainlyfocusingonoilandgasexploitationservicesandenvironmental

services.

Oil and gas exploitation services

Accordingtorelatedlawsandregulations,theownershipofmineralresourcesinChina

belongstothewholecountry,andthestateCouncilexertstheownershiponbehalfof

thecountry.toexploreorexploitmineralresources,theenterprisesmustapplyforthe

rightofexplorationandexploitationrespectively,andgothroughregistrationlegally.15

foreignerscanprovideoffshoreoil-fieldservicesonlyintheformofpetroleumexploi-

tationincooperationwithChinesepartners.16foreignerscanprovideonshoreoil-field

servicesonlyintheformofpetroleumexploitationincooperationwithChinaNational

petroleumCorp.(CNpC)indesignatedareasapprovedbytheChinesegovernment.In

ordertocarryoutapetroleumexploitationcontract,theforeignservicessuppliershould

establishabranch,subsidiaryorrepresentativeofficewithintheterritoryofthepeople’s

republicofChinaandgothroughregistrationformalitiesinaccordancewithrelevant

laws.thedomicilesofthesaidofficesshouldbedeterminedthroughconsultationwith

CNpC.furthermore,therenewableenergylawhasenteredintoforceon1January2006.

giventhatChinahassubstantialoffshoreproductionofpetroleum,onewouldexpect

thatNorwegianexportsofoilandgasrelatedservicestoChinawouldbelargerthan

whatisseentoday.OnereasonfortheseeminglymodestpresenceofNorwegianservice

providersinthisindustryintheChinesemarketmaybebecausesomeNorwegian

companiesoperatinginChinaareregisteredinsingapore.

AmemorandumofunderstandingbetweenNorway'sministryofpetroleumandenergy

andtheNationaldevelopmentandreformCommission(NdrC)ofChinaoncoopera-

tioninenergysavingandrenewableenergywassignedin2006.thepotentialforfurther

cooperationbetweenNorwegianandChinesecompaniesintheoilandgassectoris

significant,andwillbeanareaofpriorityinthefutureofsino-Norwegianeconomic

cooperation.

3.3.4 Construction (and related engineering) services

theconstructionsector’spositionandroleasapillarindustryinthenationaleconomyis

growingstrongerinChina.from2001through2005,thetotaloutputoftheconstruction

sectorgrewatanaverageannualrateof21.3%.theemployeesintheconstruction

sectoraccountedformorethan5.2%oftheemployedpopulationinthecountry.Nearly

onethirdoftherurallabourworkinginurbanareaswasintheconstructionindustry.In

2005,theaddedvaluerealisedbytheconstructionsectoraccountedfor5.5%ofgdp.

15 Article3ofMineral Resources Law of the People’s Republic of China.

16 Annex9ofthe Protocol of the People’s Republic of China on the Accession to the WTO.


foreigninvestmentinconstructionandrelatedengineeringservicesarepermittedin

theformsofequityjointventures,contractualjointventuresandwhollyforeign-owned

enterprises17inChina.AccordingtoChina’scommitmentstotheWtOandrelatedlaws

andregulations,whollyforeign-ownedenterprisescanundertakethefollowingfour

typesofconstructionprojects:

•Constructionprojectswhollyfinancedbyforeigninvestmentand/orgrants;

•Constructionprojectsfinancedbyloansorinternationalfinancialinstitutionsand

awardedthroughinternationaltenderingaccordingtothetermsofloans;

•Chinese-foreignjointlyconstructedprojectswithforeigninvestmentequaltoor

morethan50%,andChinese-foreignjointlyconstructedprojectswithforeign

investmentlessthan50%buttechnicallydifficulttobeimplementedbyChinese

constructionenterprisesalone;

•Chineseinvestedconstructionenterpriseswhicharedifficulttobeimplemented

byChineseconstructionenterprisesalonecanbejointlyundertakenbyChinese

andforeignconstructionenterpriseswiththeapprovalofprovincialgovernment.

Norwegianconstructionservicesconstitutedapproximately4,1%ofgNpand8%oftotal

employmentinNorwayin2006.mostprovidersofconstructionservicesaresmallprivate

companies.thereareanumberoflargecompaniesinthebusiness,andsomeofthese

areforeignownedcompanies.6,5%oftheworkforceintheconstructionservicessector

hasmorethan12yearseducation,comparedtoanationalaverageof27%.themajor

changesintheconstructionservicessectorinrecentyearshavebeenincreaseduseof

foreignlabour,increaseduseofprefabricatedcomponentsinbuildings,increaseduseof

informationtechnology,improvedwastedisposal/recycling,andgovernmentdemands

onenergyefficiencyinbuildings.

CompaniesperformingconstructionworkinNorwayarerequiredtoberegisteredat

theNorwegianadministrativeregisteragencyunlesstheyareregisteredinanational

registryinaeucountry.

ConsideringthecomparativeadvantagesofNorwayindesignandprojectmanagement

andthatofChinainconstructionandlabourresources,constructionandrelatedengi-

neeringservicesindustryhasthepotentialtobecomeanimportantcontributortothe

bilateraltradeinservicesbetweenChinaandNorway.therefore,bilateralcooperation

shouldbefurtherenhancedinthissector.AnftAisexpectedtoaddressanumberof

barriersincludingmobilityofnaturalpersons,marketaccessissuesandrecognitionof

professionalqualifications,whichwouldcreateanimprovedenvironmentforthebusi-

nessinthisarea.

17 seealsoArticle2ofregulationsonAdministrationofforeign–InvestedConstructionenterprises.


3.3.5 Educational services

AccordingtothestatisticsoftheministryofeducationofChina,therewerealtogether

141.087internationalstudentsstudyinginChina,up27.3%from2004.18

theprimaryadministrativedepartmentofeducationalservicesistheministryof

educationofthepeople’srepublicofChina.Jointschoolswithforeignmajorityowner-

shiparepermittedinChina.19Inaddition,foreigninstitutesandenterprises,representa-

tiveofficesofinternationalorganizationsandforeignnationalsresidinginChinaare

permittedtoestablishwhollyownedschoolstoprovidesecondaryandlowerlevel

educationservicesforchildrenofforeignnationalsresidinginChina.moreinformation

isavailableon

www.moe.edu.cn.

foreignemployeesinChinese-foreigncooperativeeducationalinstitutionsshould

complywithrelevantregulationsregardingemploymentofforeignersinChina.20detailedinformationisavailableinregulationsonthemanagementofemployment

offoreignersinChinaorthewebsite www.molss.gov.cn.

In1963,NorwayandChinasignedanAgreementonCulturalandeducationalCoop-

eration,whichisthefirstagreementofitskindthatChinaenteredintowithaWestern

country.sincethen,activitiesandcooperationinthesefieldshaveincreasedsubstan-

tially.AbilateralscholarshipprogrammeadministeredbytheresearchCouncilof

Norway(Nfr)andtheChinesescholarshipCouncilhasbeenimplementedsuccessfully

undertheframeworkoftheagreement.

meanwhile,bilateralresearchcollaborationisalsoongoinginawiderangeoffields.

AmemorandumofunderstandingforscientificandtechnologicalCooperation

betweentheChineseministryofscienceandtechnologyandtheresearchCouncil

ofNorwayhaspavedthewayforfurtherdiscussionsonprioritiesforscientificand

technologicalcooperationandsharingofinformation.polarandmarineresearchhas

alreadybeenidentifiedasareasofmutualinterest.In2006aletterofIntentbetweenthe

NorwegianministryofeducationandresearchandtheChineseministryofeducationon

Norwegian-ChineseCo-operationinthefieldofeducationwasconcluded.

thefutureftAwouldenhancethebilateraleducationalandresearchcooperation

betweenChinaandNorway,andfacilitatethemovementofstudentsandeducational

professionals.

18 China Trade in Services Report 2006,ChinaCommerceandtradepress,p.230.19 Annex9oftheprotocolofthepeople’srepublicofChinaontheAccessiontotheWtO.20 Article28ofRegulation of the People’s Republic of China on Chinese-Foreign Cooperative Education.

http://www.moe.edu.cn

http://www.molss.gov.cn


3.3.6 Hotels and restaurants services (including travel and tourism)

foreignservicessuppliersmayconstruct,renovateandoperatehotelandrestaurant

establishmentsinChinaintheformofjointventuresorwhollyforeignownedsubsidi-

aries.thereisnospecialgeographicregistrationonforeignownedhotelsandrestau-

rants.foreignmanagers,specialistsincludingchefsandseniorexecutiveswhohave

signedcontractswithjointventurehotelsandrestaurantsinChinaarepermittedto

provideservicesinChina.

In2006,hotelandrestaurantservicesconstitutedapproximately1,1%ofgNpand3,1%

oftotalemploymentinNorway.hotelsandrestaurantsgenerateapproximatelyone

thirdoftotaltouristrevenuesinNorway.thesectorisimportantinmaintainingemploy-

mentinruralareas.parttimeworkers,youngemployeesandforeignworkers,constitute

alargeshareoftotalemployeesinthesector.

CompaniesinthehotelandrestaurantsectorinNorwayarerequiredtoberegistered

attheNorwegianadministrativeregisteragencyunlesstheyareregisteredinanational

registryinaeucountry.thereisnodiscriminationofnon-nationalcompanies.however,

managersarerequiredtopassawrittentesttobeallowedtorunahotelorrestaurant.

thetestisinNorwegian,andhenceimplicitlydemandsNorwegianlanguageskills.

The Approved Destination Status (ADS) Agreement

AmemorandumofunderstandingbetweenChinaandNorwayonVisaandrelated

IssuesConcerningtouristgroupsfromthepeople’srepublicofChinawassignedin

2004.Inthesameyear,NorwaygottheApproveddestinationstatusofChina.

theAdsagreementbetweeneuandChinawentintoforceintheautumnof2004.A

similaragreementbetweenNorwayandChinawassigned3ofJune2004andenteredin

toforceparallelwiththeeu-Chinaagreement.Visahandlingproceduresarefacilitated

andtheagreementenablesgroupsofpeopletotravelforthemerepurposeoftourism.

thishascontributedtoasignificantincreaseintheNorwegiantouristsector.In2007

fromJanuarytoseptember,Norwayissued4.440visasunderthisagreement,butthis

onlyrepresentsaproportionofallChinesetouriststravellingtoNorway,whoalsocan

gettheirvisasfromothermembers(eu)oftheschengenAgreement.

therehasbeenamarkedincreaseinthetwo-waytourismflowbetweenChinaand

Norwayinrecentyears.thisdevelopmentreflectsthegrowingimportanceofthehotels

andrestaurantsservicesforbothcountries.undertheframeworkofthefutureftA,China

andNorwayareexpectedtocooperatetopromotetourismbyexploringwaysandinitia-

tivestointroducegreaterconveniencetotourists,andprovidingthemwithmoresatis-

factoryhotelsandrestaurantsservices.


3.3.7 Environmental services

theenvironmentalservicessectorincludesrefusedisposalservices,sewagesserv-

ices,sanitationservices,airpollutioncontrol,noiseandvibrationabatement,nature

andlandscapeprotectionservices,remediationandcleanupofsoil,surfacewaterand

groundwaterservices,aswellasdatacollection,analysisandassessment,amongstother

services.

partiallyduetoahistoryofrigorousenvironmentalregulations,theNorwegianmarket

forenvironmentalservicesisdiverseandadvanced,andtheNorwegianprovidersof

environmentalserviceshaveyearsofexperiencemeetingstrictrequirements.Norwe-

gianactorsholdspecialisedcompetenceinnichessuchasrenewableenergy,waste

management,sewagetreatment,andairandwatersurveillancetechnologyandsystems.

Norwayhasundertakenspecificcommitments,withsomeminorexceptions,inthegAts

forallcategoriesofenvironmentalservices,providingmarketaccessfornon-domestic

servicesproviders.

sincetheaccessiontotheWtO,Chinahasopenedallcategoriesofenvironmentalserv-

icesexceptenvironmentalqualitymonitoringandpollutionsourceinspection.foreign

enterprisesmayestablishjointventureswithChineseenterprisesinChina,andthere

isnolimitationonownership.relatedregulationsandmeasuresissuedbythestate

AdministrationofenvironmentalprotectionofChinaincludeMeasures for Operation

Certification for Environment Pollution Treatment Facilities,Measures for Administration

of Qualification for environment Impact Assessment on Construction Project,andMeasures

for Administration of Operation License for Hazardous Wastes.

severalNorwegianbusinessesintheenvironmentalservicessectorarealreadyengaged

intheChinesemarket,providingvariousservicessuchasadvancedsolutionsenabling

recoveryandrecyclingofmaterials,biologicalwastewatertreatmentforboththeindus-

trialandmunicipalsectors.thereis,moreover,reasontobelievethatgivenfavourable

conditions,thetradeofenvironmentalservicesbetweenNorwayandChinahaspoten-

tialtogrowsubstantially.

3.4 Overall impact of liberalizing trade in services

servicesareessentialinputsintheproductionofgoodsandotherservices.theyencom-

passavastanddisparaterangeofeconomicactivitiesanddominatetheeconomiesof

developedandmanydevelopingcountries.Openservicesmarketsbringdirectecono-

my-widebenefitsthroughthefacilitationandencouragementofinnovation,efficiency,

andqualityimprovement,whentheyareregulatedinaccordancewithsound,efficiency-

enhancingprinciples.


thesurveysofselectedservicesectorshavedemonstratedthatservicesarenotonly

importantintheeconomiesofNorwayandChina,butalsoanimportantcomponent

oftotalbilateraltrade.servicesarethemaindriversofeconomicgrowthindeveloped

economiesandareplayinganincreasinglyimportantroleineconomicdevelopment

ofemergingeconomies.

Whilesino-Norwegiantradeinservicesisincreasing,furtherliberalisationoftrade

inserviceswouldbebeneficialtotheeconomiesofbothcountriesandaswellasto

economiccooperationandthefacilitationofincreasedinvestmentsbetweenChina

andNorway.

ChinaandNorwayrecognisetheimportancetoseekmutualbeneficialandtailormade

solutionsforliberalisationofbilateraltradeinservicesinfutureftAnegotiations.While

thetwocountrieshavemadecommitmentsintheWtO,therearestillsomerestric-

tionsintheservicessectorsonbothsides.Itisrecommendedthatthattheseissuesare

addressedinfutureftAnegotiations.Allpotentialimpactsonbothcountriesservices

sectorsshouldbetakenintoaccountinanyftAnegotiations.

theoverallimpactsoffurtherliberalisationinservicestradeareexpectedtodeliver

positiveresultsforboththeChineseandNorwegianeconomies.Accesstonewtech-

nologiesandexpertisecanbeasignificantpositivefactorforeconomicdevelopment

andconsumerwelfare,byloweringcostsforconsumersandproducersandshiftfactors

ofproductiontomoreeffectiveuse.servicestradeliberalisationshouldseektoreduce

barrierstotradewhiletakingintoaccountlegitimatenationalpolicyobjectivesinareas

suchasprotectingtheenvironment,ensuringhumanhealthandpromotingcultural

diversity.

65

Chapter four: Investment

foreigninvestmentisrecognizedbybothChinaandNorwayasakeytoeconomic

growthandanimportantbasisfordeepeningandbroadeningthebilateraleconomic

relationship.thischapterprovidesanoverviewofpoliciesandbarriersthataffectthe

investmentflowbetweenChinaandNorway,andexploresopportunitiestopromote

bilateralinvestment.

4.1 An overview of Chinese investment policy and measures

foreigninvestmenthasbeenanimportantpartofChina’sopen-doorpolicywhichis

thebasicstatepolicy.foreigninvestmenthasplayedapivotalroleinChina’ssustainable

economicdevelopmentsinceitadoptedreformsandtheopen-doorpolicybeginning

in1978.foreigninvestmenthascontributedtotheChina’seconomicdevelopmentby

providingcapital,technology,managerialexpertise,andincreasingemployment,exports,

andgovernmentrevenue.

for14yearsuntil2006,Chinahasremainedthelargestrecipientofforeigndirectinvest-

ment(fdI)amongdevelopingcountries.Oftheworld’slargest500firms,over480have

investedinChina.

therehavebeensignificantchangesinChina’sfdIpolicyregimesinceitsaccession

toWtO,whichincludeeffortssuchasdecentralisation,liberalisation,enhancementof

transparencyandlegislativestrengthening.ChinahasimproveditsoverallfdIpolicy

regimebyenhancingtransparencyandabolishingmanyWtO-inconsistentinvestment

measures.substantialprogresshasbeenmadetowardstheobjectiveoffurtheropening

uptheservicesectors,andChinahasstrictlyhonoureditsWtOcommitmentsinceacces-

sion.substantiveprogresshasbeenmade.forexamplemeasuressuchas,relaxationof

geographicalandownershiprestrictions,andremovalofrestrictionsonscopeofbusi-

ness,amongothers,havebeenapplied.

Chinaisstrugglingtoshiftitseconomicgrowthpatternandtransformitselfintoa

resource-conserving,environmentallyfriendly,andinnovation-drivencountry.priori-

tiesonattractingforeigninvestmentwillbeconsistentwithitsmacroeconomicgoals.

Chinahasintroducedanindustrialpolicywhichservesasguidanceforforeigninvest-

ment.thelatesteditionoftheIndustrialCatalogueonguidingforeignInvestment

hasbeenpromulgatedrecentlywithaviewtoreshapingthefdIstructureinlinewith

I m pA C t O f t r A d e l I b e r A l I s At I O N I N g O O d s66 I N V e s t m e N t66

China’snationaleconomicdevelopmentstrategy.thenewCataloguecameintoeffect

on1december2007.foreigninvestorsarewelcometoengageintheareasofhigh-

tech,energy-savingandenvironmentalprotectionsectors,modernagriculture,modern

serviceandservice-outsourcingsectors.

theChinesegovernmentisalsomakingeffortstocoordinateandharmonizeregional

economicdevelopmentbycarryingoutstrategiessuchas“thegoingweststrategy”,“the

riseofthecentralregionofChina”,andupgradingoftheoldindustrialfoundationsinthe

northeastofChina.fdIpolicyisalsointendedtoassistsuchstrategies.

Inrecentyears,ChinahasalsostartedtoencourageoutwardfdI,largelytoupgrade

technicalskillsandtosecuresuppliesofkeyrawmaterials,suchaspetroleumandiron

ore.theCentralgovernmentandsomeprovincialgovernmentshavebeenencouraging

firmstoinvestabroadbyrelaxingapprovalproceduresandprovidingfinancialsupport.

forexample,theNationaldevelopmentandreformCommission(NdrC)andtheexport-

ImportbankofChinaissueda"NoticeonloansupportpolicyforKeystate-encouraged

OverseasInvestmentprojects"on27October2004,whichspecifiesthatpreferential

interestratesmaybeappliedtooverseasinvestmentloans.

AdescriptionofChina’sfdIpolicies,legislationandproceduresfollowsbelow:

Foreign Investment Forms

fdIinChinafallsintothreemajorcategories,whicharerespectivelyChinese-foreign

equityjointventures,Chinese-foreigncontractualjointventuresandwhollyforeign-

ownedenterprises.

Chinese-foreignequityjointventuresarejointlyestablishedwithinChinabyforeign

individuals,enterprisesorothereconomicorganizationsononesideandenterprisesor

othereconomicorganizationsinChinaontheother.thiskindofjointventuresshalltake

theformofalimitedliabilitycompany.

Chinese-foreigncontractualjointventuresmeanthatpartiestosuchaventureshall

agree,priortothecooperativeestablishmentoftheventure,ontheconditionsfor

investment,theratioofthedistribution,thesharingofrisks,theformofoperationsand

managementandtheownershipoftheassetsatthetimeofterminationoftheventure.

Whollyforeign-ownedenterprisesareestablishedwithintheterritoryofChinaand

involvecapitalinvestmentsolelymadebyforeigninvestors.theterm“whollyforeign-

ownedenterprise”doesnotcoverbranchesofforeignenterprisesestablishedwithin

theterritoryofChina.

Legal Framework

thebasiclawsandregulationsofChinaconcerningforeigninvestmentareLaw on

Chinese-Foreign Equity Joint Ventures, Law on Chinese-Foreign Contractual Joint Ventures,

Law on Wholly Foreign-owned Enterprises andtheirimplementingregulations.theselaws

http://www.chinacp.com/eng/cporg/cporg_ndrc.html


havebeenreviewedandrevisedperiodicallytoreflectdevelopmentsintheWtOand

China’sowncommitments.Quiteafewrestrictions,suchasrequirementonthebalance

offoreignexchange,exportperformance,localizationofsuppliesandnotificationof

productionplans,havebeenremovedinrecentyears.

OtherrelevantlawsandregulationsimportantforforeigninvestorsincludeCorporate

Income Tax Law (whichisaunifiedincometax,andwillbeimplementedon1January,

2008), Company Law andContract Law.

Industry Policy

theRegulation on Guiding Foreign InvestmentandtheIndustrial Catalogue on Guiding

Foreign Investmentareformulatedtoguidetheorientationofforeigninvestmentinline

withthenationaleconomicandsocialdevelopmentstrategyofChina,andtofurther

protectthelawfulrightsandinterestsofinvestors.Accordingtotheaboveregulations,

allforeigninvestedprojectsfallintofourcategories,namelyencouraged,permitted,

restrictedandprohibited.formoredetails,pleaserefertowww.fdi.gov.cn.

Establishment Approval

China’sprimaryregulationsonapprovaloffdIprojectsincludethelawonChinese-

foreignequityJointVentures,lawonChinese-foreignContractualJointVentures,law

onWhollyforeign-ownedenterprisesandtheirimplementingregulations,theAdminis-

trativelicensinglaw,theCatalogueonguidingforeignInvestment,andothersectoral

policiesorguidelines.

Asadecentralizationeffort,competenceforscreeningandverificationhasbeendele-

gatedtotheprovincialgovernmentauthorities.theseauthoritiescanscreen,verifyand

approveforeigninvestmentsnothigherthanus$100millionin“permitted”and“encour-

aged”industries.for“restricted”industriesthelimitisus$50million.Incasesofsome

newlyopenedservicesectors,regulationsorguidelinesonverificationproceduresapply.

projectsvaluedatmorethanus$100millionfor“permitted”and“encouraged”industries

(us$50millionforrestrictedindustries)whichalsofallsintothe“permitted”and“encour-

aged”categoryintheCatalogueonguidingforeignInvestmentmustbeverifiedbythe

NationaldevelopmentandreformCommission(NdrC)andtheministryofCommerce

atthenationallevel.

moredetailsareavailableon www.fdi.gov.cn.

Regional Policy on Foreign Investment

toattractfdItosupportthebalancingandcoordinationofregionaleconomicdevel-

opmentisapriority.theCentralgovernmenthasinitiatedstrategiesofpromotingthe

developmentofthewesternregion(“goweststrategy”);centralregion(“theriseofthe

centralregionofChina”);andthenorth-easternregion(byfurtheropeningoldindustrial

foundations).theChinesegovernmentencouragesforeigninvestorstoparticipatein

therenovationandrestructuringofstate-ownedenterprisesandinvestmentsinsome

http://www.fdi.gov.cn

http://www.fdi.gov.cn


keyindustrieswhicharelocallyadvantageousandcrucialtotheregionaldevelopment.

thegovernmentalsowelcomesinvestmentmadebyforeigncorporationsinthecentral

regionthroughthetransferofthehighvalue-addedpartofmanufacturingandservice

outsourcing.

The New “Corporate Income Tax Law”

thenew“CorporateIncometax(CIt)law”waspassedatthe5thsessionofthe10th

Nationalpeople’sCongresson16march2007.thenewlawwillapplytobothdomestic

andforeigninvestmententerprises(fIes).

thenewtaxlawwasimplementedon1January2008.productivefIeswhichenjoy15%

and24%favourableincometaxratesbasedonthepresentincometaxlaw,willpaya

singleuniformcorporateincometaxof25%.theyareeligiblefora5-yeartransition

periodwithagradualincreaseuptothe25%taxrate,althoughthe“Newlaw”doesnot

providethedetailsforthistransition.

Withtheenforcementofthe“Newlaw”,somepreferentialCItpoliciescurrentlyavailable

exclusivelytofIeswillberevoked.forexample,theincometaxincentivesof“2years

exemptionand3yearsdeduction”willbeabolished.buttheproductivefIeswhichhave

notfullyutilisedthe5-yeartaxholidaybeforetheeffectivedateofthenewtaxlawwill

continuetoenjoytheremainingtaxholiday.

Accordingtothe“Newlaw”,theincometaxrateforcompaniesengagedinservicetrade

willgodownfrom33%to25%,indicatingagreatlyreducedtax.small-sizedandtiny-

profitcompanieswillenjoya20%preferentialtaxrate.

thenewincometaxlawwilladoptanewmechanismwithincentiveorientations

“focusingonpriorityindustriesandsupplementedbypriorityregions.”foreigninvest-

mententerprisesengagedindevelopmentofhigh-tech\new-tech,infrastructure,agri-

culture,forestry,animalhusbandry,andenvironmentprotectionsectorswillbegranted

newtaxincentives.thenewincometaxlawwillprovideincentivestothewesternregion

andspecialeconomicareas.

4.2 An overview of Norwegian investment policy and measures

Norwayhasalongtraditioninwelcomingforeigninvestments.severalofNorway’skey

industrialsectorsweredevelopedwithforeigncapitalandcompetence.thehydro-

electricpowerplants,whichwerethebasisofthefertilizerindustryandthealuminium

industry,areexamplesofsuchsectors.today,Norwayisamongtheworld’slargest

producersinboththesesectors.

furthermore,Norwayisanopeneconomythatwelcomesforeigninvestmentsasa

matterofpolicy.Norwayprovidesastableandpredictableenvironmentforforeign


investors.theWorldbankrankedNorwayin2007asthe10theasiestcountryintheworld

todobusinessinandasthe8thbestcountrywhenitcomestoenforcingcontracts.

Norwaygenerallygrantsnationaltreatmenttoforeigninvestorsandspecificexceptions

fromtheseprinciplesaremadeonlyinalimitednumbersofsectors.thegovernment

portalwww.bedin.nocontainsinformationonrulesandregulationspertainingtoestab-

lishingandrunningabusinessinNorway.foreigncompaniesmayalsogetassistance

fromInnovationNorwayinbusinessdevelopmentthroughoutNorway.Innovation

Norway’sChinaofficesarelocatedattheroyalNorwegianembassyinbeijingandat

theroyalNorwegianConsulateinshanghai.

Attheendof2005thestockofforeigndirectinvestmentsinNorwayamountedtous$

80.3billion.europeaninvestorsownedmorethan70%ofthiscapital.31%weredirected

towardsoilproductionand28%towardsmanufacturing.Approximately40%wentto

theservicesector,wherefinancialservices,insuranceandbusinessservicesaccounted

foralmosthalfofthis.

Norwayisamongthebestcountriesineuropewhenitcomestoentrepreneurshipand

innovationaccordingtogem(globalentrepreneurshipmonitor),andthereisasteadily

increasinginterestinstartingupnewbusinessinNorway.

therearetwotypesoflimitedliabilityCompaniesinNorway:

•privatelimitedliabilitycompany(As)–sharecapital:NOK100.000(us$16000),

whichisthemostcommon

•publiclimitedliabilitycompany(AsA)–sharecapital:NOK1.000.000(us$160000),

mostlylistedontheOslostockexchange)

ItisveryeasytostartanewcompanyinNorway.AccordingtotheWorldbankittakes

just10daystostartupanewbusinessinNorway,comparedtoanaverageof15daysin

theOeCdcountries.thenewcompanywillhavetoregisterintheregisterofbusiness

enterprisesandtheCentralCo-ordinatingregisterforlegalentities.

theadvantagesofinvestinginNorwayarei.a.asfollow:

•Open,strongandstableeconomy;

•fullbusinessaccesstotheeu-marketthroughtheeeAagreement;

•highlycompetentandmotivatedworkforceatcompetitivewages;

•stablepoliticalclimateandefficientbureaucracy;

•lowcorporatetaxrateat28%andthelowestincometaxamongtheNordicstates;

•goodproficiencyofforeignlanguagesandenglishisspokeneverywhere;

•Advancedr&denvironment–largeforeignr&dinvestmentinNorway,inpartic-

ularinselectedbrancheslikeIt(googleandyahoointrondheimandallmajor

internationalenergycompaniesinstavanger);

•taxdeductionforr&dexpenses–(skattefunn);

•satisfiedforeigninvestorsasforeignownedcompaniesarequiteprofitable(2004,

10%grossprofitonaverage);

•excellentairandrailconnectiontomajormarketsandlogistics;and

•highqualityoflife

http://www.bedin.no


Attheendof2005,Norwegianforeigndirectinvestmentabroadamountedtous$102.6

billion.Norwayhasarelativelylargeshareofitsdirectforeigninvestmentsinmanufac-

turingandminingindustries(35%)andarelativelyminorshareofinvestmentsinserv-

ices(25%),comparedtothestructureofNorwegianeconomy.Norway’sforeigndirect

investmentswereconcentratedineurope(56%).20%wenttoNorthAmericaand11%

toAsia.

4.2.1 Norwegian foreign portfolio investments through the Government Pension Fund – Global

thepetroleumfundwasestablishedin1990asafiscalpolicytooltosupportalong-

termmanagementofthepetroleumrevenues.renamingthefundthepensionfund

-globalin2006waspartofabroaderpensionreform,highlightingalsothefund’srole

infacilitatinggovernmentsavingsnecessarytomeettherapidriseinpublicpension

expendituresinthecomingyears.

duetolargeannualcashflowsfromthepetroleumactivities,causingconsiderable

surplusesongovernmentfinances,thefundhasgrownrapidlysincethefirstcapital

allocationin1996.Currentsizeofthefundisus$301billionasof30september2007.

theministryoffinanceisresponsibleforthemanagementofthefund.theoperational

managementiscarriedoutbyNorgesbank(theCentralbank)whichinveststhefundin

accordancewithguidelinesissuedbytheministry.theinvestmentstrategyforthefund

istoachievehighfinancialreturnssubjecttomoderaterisk.theguidelinesstatesthat

thefundisonlytobeinvestedabroadinfinancialinstruments,andactsasafinancial

investorwithasmallownershipshareinindividualcompanies.equitieshaveaccounted

for40pct.ofthefundsstrategicbenchmark,andbonds60pct.InJune2007,theministry

offinancechangedthebenchmarkforthefund,andthenewstrategicbenchmark

consistsof60%equitiesand40%bonds.theguidelinesalsostatesanoveralllimit

ondeviationsbetweenthebenchmarkportfolioandactualportfolio,expressedasa

trackingerrorof1,5percentagepoints.

therisksfacingthefundarewelldiversified.thebenchmarkportfoliocomprisesindices

for27stockmarkets,including5markets21classifiedasemergingmarketsbythebench-

markindexprovider,ftse.thelistofemergingmarketsincludedinthebenchmark

hasbeendeliberatedatregularintervalsintheNationalbudgetdocuments,andwas

lastchangedin2003fortheNationalbudgetfor2004.themarketanalysisisbasedon

asobjectivecriteriaaspossible,measuringwhethermarketsareopentoforeigners,

whetherthelegislationineachmarketprotectsinvestorrightsandwhethereachmarket

satisfiesminimumrequirementsregardingsettlementsystems,size,liquidityandpolit-

icalandmacroeconomicstability.thesizeofthemarketsisalsoimportantwhenmeas-

21 brazil,mexico,southKorea,ChinesetaipeiandsouthAfrica.


uringhowtheinclusionofnewmarketsinthebenchmarkwillchangetheportfolios

expectedriskandreturn.

Inadditiontothemarketsincludedinthebenchmark,Norgesbankisallowedtoinvest

inothermarketsbasedontheirownassessmentofissuesrelatingtovaluation,return

measurement,aswellasthemanagementandcontrolofrisksassociatedwithinvest-

mentsineachindividualmarketandcurrency.

The Government Pension Fund – Global’s investments in China

Norgesbankpublishesthefundsholdingsasofeachyear-end.Whileinvestmentsin

fixedincomeinstrumentshavebeenverylimited,investmentsinChineseequitieshave

beensignificant.Intable4-1,companiesareclassifiedaccordingtothelocationoftheir

headquarters.sincecompanieslocatedinhongKongoftengiveexposuretowardthe

Chineseeconomy,holdingsofhongKongcompaniesarealsoreported.thestatements

fortheyears2005and2006showsthattheholdingsofChinese/hongKongequities

havemorethandoubledfrom2005to2006.eventhoughthefundhasgrownrapidly

duringthisperiod,theshareofChineseandhongKongequitiesintheequityportfolio

hasincreased.thesharesofChineseandhongKongequitiesasapercentageofthe

overallequityportfolio,bytheendof2006,were0,7pct.and1,2pct.respectively.

the1,2pct.shareinhongKongequitiescorrespondedwiththeshareofhongKong

equitiesinthefundsbenchmark.

Table 4-1 Investments in China/Hong Kong companies 2005–2006.

2005 2006

China Hong Kong China Hong Kong

marketvalue(us$million) 327,2 726 752 1048

Numberofcompanies 45 119 89 133

shareofoverallequityportfolio 0,4% 0,8% 0,7% 1,2%

source:Annualreports,Norgesbank.Companiesareclassifiedaccordingtothelocationoftheirheadquarters.

bymarch2007,NorgesbankInvestmentmanagement,whichisresponsibleforasset

managementwithinNorgesbank,had135permanentemployees.NbImcurrentlyhas

officesinNewyorkandlondoninadditiontoOslo.thebankopenedanewofficein

shanghaiinthefallof2007.Withtheopeningoftheofficeinshanghaithebankwillgain

localpresenceintheAsianmarkets,whichconstitutes15%ofthefundsbenchmarkfor

equitiesand5%forbonds.


4.3 Bilateral direct investment between China and Norway

AnincreasingnumberofNorwegiancompaniesinvestinChina.themostrecentbig

investmentsincludeNorskeskog,Norskhydro,Jotun,andttsmarinesAsA.In2005the

governmentpensionfund-globalinvestedmorethanatotalofus$752millionin89

ChinesecompanieslistedinChina.AccordingtoNorwegianinformation,closeto200

NorwegiancompaniesareestablishedinChina.35to40oftheseareproductioncom-

panies.theotherestablishmentsaresalesofficesandrepresentativeoffices.

AccordingtoNorwegianstatistics,NorwegiandirectinvestmentsinChinain2004

amountedtoalmostus$25,3million.however,sinceNorskeskogsinvestmentsinChina

alonehaveamountedtoalmostus$296million,thesenumbersapparentlydonotgive

thefullpictureofNorwegianinvestmentsinChina.

AccordingtoofficialChinesefigures,Norwayhadmade258separateinvestmentsin

China.furthermoreNorwayhadinvestedus$268millionbytheendof2006,andmade

commitmentstoinvestafurtherus$533million.

themainsectorsforNorwegianinvestmentsinChinaarethemaritimesector,theenergy

andenvironmentsector,oilandgas,aquaculture,andtheprocessingindustry.

ChinesecompaniesarealsoinvestinginNorway.tothisdate(december2007)three

ChinesecompaniesareestablishedinNorway;Zte,COsCOandAirChina.

AsaresultofincreasedinvestmentsbetweenChinaandNorwayasub-committeeon

investmentswasestablishedinseptember2006,undertheJointeconomicCommission.

theobjectiveofthesub-committeeistofacilitatebilateralinvestmentsbyexchanging

informationonlaws,regulations,policiesandotherrelatedinformationonoverseas

investments.thecommitteealsoenablesChineseandNorwegianinvestorstoraise

issuesofconcern.

Abilateralinvestmenttreaty(bIt)isinforcebetweenNorwayandChina.thetreaty

wassigned21November1984andenteredintoforce10July1985.thetreatyincludes,

i.a.provisionsonmostfavourednationtreatmentandexpropriation,givinginvestors

predictabilityintheareascovered.

4.4 Overall impact of liberalizing investment

thestudyshowsthattheinvestmentflowsbetweenChinaandNorway,although

increasingrapidlyinrecentyears,arestillmodestrelativetobilateraltrade.thisreflects

bothregulatoryandotherimpedimentstoinvestmentand,tosomedegree,lackof

awarenessofbusinessopportunitiesintheothercountry.


Asaninternationaltreaty,thefutureftAbetweenChinaandNorwaywouldresultin:

•greatertransparencyofregulationsandlawsthataffectbothdirectandportfolio

foreigninvestments;

•moreliberalisedregimeswhichwillfacilitateforeigninvestmentineachcountry;

•morestablepolicyframeworksforinvestors,whichcouldfacilitatethetwocoun-

triesdevelopingbilateraltradeandeconomicrelationsmoreactively;and

•opendomesticmarketstoeachothermorequickly.

thefutureftAbetweenChinaandNorwaywouldprovideanimprovedinvestment

environmentforbilateralbusinesses.bothcountriescouldbenefitfromanincreasein

bilateralinvestment,andtheexchangeandtransferofknowledge,technology,ideas

andexportopportunitiesthatwouldflowfromincreasedinvestments.furthermore,the

futureftAwouldbeexpectedtopromotebilateralinvestmentnotonlybystrength-

eninginvestorconfidence,butalsobypositivelyaffectingmarketperceptionsandlead

toincreasedinvestorinterestsinnewbusinessopportunitiesintheothercountry.In

thelongrun,moreintegratedmarketsforgedbytheftAcouldimprovethecompeti-

tivecapacityofenterprises,theefficientdistributionofresources,andfurtherpromote

two-wayinvestment.

ChinaandNorwayshouldreaffirmtheirdesiretoconsiderthepotentialforfurthercoop-

erationopportunitiesintheftAandtoincreasethemutualbenefitsthroughthefurther

facilitationofbilateralinvestment.

74

Chapter five: Strengthening bilateral economic cooperation

AnftAwouldbeexpectedtofurtherenhancebilateraltradeandeconomiccoopera-

tionbetweenChinaandNorway.therefore,itisagreedthatthejointftAfeasibilitystudy

shouldaddressothersector-specificissuesandbroaderhorizontaltopicsofimportance

tothecommercialrelationship,andhighlightpossibleareasforcooperationandfacili-

tationtofurtherpromotebilateraltradeandinvestmentthroughanftA.thischapter

exploreseachoftheseissuesinturn,includingtradefacilitation,e-commerce,sanitary

andphytosanitarymeasures,technicalregulationsandstandards,intellectualproperty

rights,sme’scooperation,temporarymovementofnaturalpersons,tradeandinvestment

promotion,environmentandtechnologycooperation,anddevelopmentcooperation.

5.1 Trade facilitation

Itiswellrecognizedthattradefacilitationcontributesgreatlytotheliberalisationof

internationaltrade,whichnowadayskeepsexpandingmuchmorerapidlythanever

before.Inpromotingthetraderelationsbetweennations,tradefacilitationalsoplays

adistinctrole.Asakeylinkintheinternationalcirculationofcommodities,customs

proceduresplayanimportantroleinpromotingthedevelopmentoftradefacilitation.

China

Atpresent,themodernizationofthecustomsregimeisunderwayinChina.tradefacilita-

tionisoneofthegoalsthatChinaCustomsendeavourstoreachbyitsongoingmoderni-

sationdrive.theapproachesoftradefacilitationtakevariousformssuchasestablishing

infrastructureandfacilitiesfortrade,enhancingtransparencyintrade-relatedregula-

tions,simplifyingtheproceduresfortrade,andapplyingbestpracticeandtechniques

developedbyrelevantinternationalorganizations.Inaword,tradefacilitationcouldbe

regardedasaprocessofreforminthecustomsregimewhichaimstofacilitatethemove-

ment,releaseandclearanceofgoods.

Chinaactivelytakespartinvariousinternationalforaengagedintradefacilitationunder

differentframeworks,whichincludeApeC,theWorldCustomsOrganisation(WCO),and

theWtO.Chinaisalsoinvolvedinsomeregionaltradearrangements,e.g.thegreat

mekongsubregion(gms).


undertheWtOdoharoundNegotiations,Chinaisanactiveparticipantinthenegotia-

tionsontradefacilitation.sofar,Chinahassubmitted7proposalsfocusingontranspar-

ency,riskmanagement,post-clearanceauditingandidentifyingneedsandpriority.most

oftheproposalsareco-sponsoredbyothermembers.throughclarifyingandimproving

gAttarticleV,VIIIandX,andprovidingtechnicalAssistanceandCapacitybuilding

(tACb)andspecialanddifferentialtreatment(s&dt)todevelopingcountrymembers,

Chinabelieves,tradefacilitationwillbenefitallthemembersunderthemultilateral

tradesystem.

In2006,theNationalOfficeofportmanagementwasformallysetup,whichhasenabled

portmanagementtotakeonanewlook.ChinaCustomshasmadeeveryeffortto

promotetheIntegratedClearanceproject,whichfullycapitalisesfromanestablished

liaisonandcoordinationmechanismbetweenthedifferentportmanagementsand

authorities.Asaresult,mostoftheportshavewitnessedconstantlyincreasedcustoms

clearanceefficiency,especiallyintheportsconsideredimportant.

ChinaCustomshasengrainedthestrategyof“buildingasmartCustomswithscience

&technology”initsday-to-daywork,underwhichtheCustomspaysgreatattentionto

raisingthemanagementlevelbyusingscience&technologyandtheeffectivenessof

science&technologyapplications,andhasprincipallyestablishede-Customs,e-port

ande-generalAdministrationapplicationsystems.thesesystemsareprovidingstrong

technicalsupportfornetworkedCustomsclearanceoperations,smartcontrol,digitised

managementandsoundadministrativedecisions.

Currently,e-Customssystemhasbeenupgraded,switchingfromh883toh2000.for

e-general-Administrationsystem,ChinaCustomshasdevelopedandappliedthesub-

systemsforimportandexportstatisticscompilation,riskmanagement,enforcement

evaluation,revenueanalysisandmonitoring,priorwarningmonitoring,officeautoma-

tion,anti-smugglinginvestigation.e-portsystemhasdevelopedintoaunifiedcross-

department,cross-regionandcross-sectorinformationplatformforbothportclearance

enforcementandmanagementandrelevantlogisticalservices.

Norway

tradefacilitationisanareawhichtheNorwegianAdministrationregardstobevery

important.theNorwegianCustomsAdministrationiswithinitscompetencecontinu-

ouslytryingtosimplifyimportandexportproceduresaswellasothercustomsrelated

procedures.

theNorwegianCustomsparticipatesactivelyinvariousinternationalforaengagedin

activitiessuchassimplificationofcustomsproceduresandtradefacilitation.thesefora

includetheuN,WCO,variouseuandeftAcommitteesandotherorganisationslikethe

Internationalroadtransportunion(Iru).

Onepriorityduringthelastfewyearshasbeenthedevelopmentofthe”NewCompu-

terisedtransitsystem(NCts)”togetherwiththeeuandtheothereftAcountries.the

I m pA C t O f t r A d e l I b e r A l I s At I O N I N g O O d s76 s t r e N g t h e N I N g b I l At e r A l e C O N O m I C C O O p e r At I O N76

euandtheeftAcountriesarecontractingpartiestothetransitConvention.Whenthe

NCtsbecameoperative,transitofgoodswithineuropebecame”paperless”,andall

communicationconcerningtransitconsignmentsbetweenCustomsauthoritiesare

conductedbyelectronicmessages.

since1988theNorwegianCustoms’electronicclearancesystemtVINNhasbeen

appliedforimportdeclarationsandsince1992forexportdeclarations.today99%ofall

importandexportdeclarationsaresubmittedandclearedthroughthetVINNsystem.

theaverageclearancetime(exceptfordocumentsandconsignmentsstoppedfor

control)islessthan10minutesfromthetimewhenthedeclarationissubmittedtothe

Customsandthegoodsarereleased.Claimsforcustomsdutiesandothertaxes

areautomaticallyissued.

thetVINNsystemisopen24hoursadayanddeclarationsmaybesubmittedatalltime.

Ifthesystemfindsnoerrorsinthedeclaration,oritisnotstoppedbyanycontrolparam-

eterssetinthesystem,theconsignmentisnormallyreleasedforfreeusebytheowner

withoutfurtherinterruption.

theNorwegianCustomshasalsodevelopedelectronicsystemsforassessingand

claimingexcisedutiesandvehicletaxes,accounting,enforcementpurposesandrisk

analysis.theNorwegianCustomshasalsolinkswiththecomputersystemsofother

governmentalauthoritiesonbehalfofwhichtheCustomsperformsvarioustask.such

authoritiesincludeveterinaryandagriculturalauthorities.thecustomsproceduresand

theelectronicsystemsusedbytheNorwegianCustomsareunderconstantscrutiny

aimedatachievingfurthersimplificationandefficiencyforboththeCustomsandthe

traders.

Norwayhasinmostrespectsgonebeyondtherequirementsandrecommendationsset

ininternationalbodies,conventionsandagreementswheresimplificationofCustoms

proceduresisconcerned.however,theNorwegianCustomsgivesprioritytofurther

internationalharmonizationofCustomsprocedures,forexamplethroughtherevised

KyotoConventionandasanintegratedpartofinternationaltradeagreements.Inthe

developmentofsimplifiedproceduresandelectronicsystems,theuseofinternational

standardsandrecommendationsisconsideredveryimportant,andtheseareappliedin

mostcaseswheresuchstandardsexist.

Inafreetradecontext,Norwayaimsatliberalisingtradeproceduresbetweenfreetrade

partnerstotheextentpossible.time-consumingproceduresaremajorobstaclesto

trade.byestablishingcomputerizedclearancesystemsandsophisticatedriskmanage-

mentsystemsandtargetedcontrols,mostofthetradecanbeconductedbetween

exportersandimporterswithoutunnecessarydelays.

WithintheWtO,Norwayisactivelyparticipatinginthenegotiationsontherevision

ofgAttArticlesV,VIIIandX.


IntheongoingnegotiationsonftAswithintheeftAframework,tradefacilitationisa

subjectofconsiderableimportance.WithintheeftAstatesprovisionsontradefacilita-

tionforfutureftAsisunderconstantdevelopmentdependingontheviewandsituation

ofthepartnercountry.

Opportunities for Future Cooperation

efficientandsimplifiedcustomsproceduresarecrucialincontributingtowardstrade

facilitationbetweenChinaandNorway.Cooperationcanensurethatcustomsrequire-

mentsaremet,whileminimisinganydisruptiontotheflowofgoods,andavoidingany

unnecessarycoststotraders.undertheframeworkofthefutureftA,ChinaandNorway

Customscouldstrengthentheirexistingrelationshiptofurtherfacilitatebilateraltrade.

furthermore,theinclusionofprovisionsoncustomsproceduresandtradefacilitationin

afutureftAwouldbebeneficialtosino-Norwegiangoodstrade.

5.2 E-commerce

theincreasinguseofinformationtechnologyanddigitalcommunicationssystems,

especiallytheInternet,bybusinessinChinaandNorwayhasbeenamajordrivingforce

behindtherapiddevelopmentofe-commerceinrecentyears.e-commercecanbring

marketsclosertogether,thusfacilitatinggoodstradeandintroducingnewservices.the

enterprises,smesinparticular,willprofitfromtheuseofe-commerceasitimproves

efficiencyandreducethecostoftransactions.

China

Althoughstartinglate,e-commerceiswitnessingarapidpopularizationanddevelop-

mentinChina.AccordingtothelateststatisticsfromChinaInternetNetworkInformation

Centre(CNNIC),thenumberofInternetusersinChinareached162millionbyJune2007,

rankingthe2ndintheworld,onlyaftertheunitedstates.Amongthem,about104million

arebroadbandInternetusers.bytheendof2006,thenumberofcomputerslinkedtothe

InternetinChinareached60million.

besidesindividualInternetusers,mostChineseenterpriseshaveestablishedtheir

ownenterpriseresourceplanning(erp)systemsandhavebeencarryingoutnetwork

marketing,supply-chainmanagement(sCm)andcustomsrelationmanagement

(Crm).themodelsforconductinge-commerceamongChineseenterprisesvaryand

includesettingupwebsitesforon-lineexpositions,on-linetrans-nationalprojectfairs,

continuousonlinefairsandinformationportals.Chinesecompanieshavebeenexploring

marketsthroughonlinenegotiations,onlinesalespromotionsandonlinetrading.Online

purchasing,onlineauctionandonlinebiddinginChinahavealsoexperiencedarapid

increase.statisticsfrommOfCOmshowsthatthee-commercetradeofChinareachedto

rmb1700billion(aboutus$212.5billion)in2006,amongwhichthebusiness-to-busi-

ness(b2b)e-Commercevalued1280billionrmb1280billion(aboutus$160billion).


Withthedevelopmentoftheinfrastructure,humanresourcesandinformationtech-

nologyinthenewcentury,Chinaisinapositiontofurtherexploretheuseofe-com-

merce.InJuly2007,theNationaldevelopmentandreformCommissionandtheInforma-

tionWorkOfficeofthestateCounciljointlyreleasedthefirste-commercedevelopment

planofChina.thenewplanputsforwardthegeneralobjectivesofChina’se-commerce

developmentinthenextfive-yearperiod.specifically,by2010,abasicpatternofe-com-

mercedevelopmentenvironment,supportsystems,technicalservicesandapplications

shallbeformed.e-commerceshouldbythatpointbecomeanimportantindustryand

e-commerceapplicationsshoulddevelopdramaticgrowthinthenationaleconomy

andsocialdevelopment.Inordertomeetthegoal,theplanstatestwoemphasisesof

e-commerce.Oneistopopularizee-commerceapplicationsandtheotheristodevelop

thee-commerceindustryonagrandscale.

Norway

Norway’sInternetcommunicationsystemsareofhighstandards,withtheadoptionrates

bybusinessesandhouseholdsconsistentlyrankingamongtheleadnationsoftheworld.

the2006e-readinessrankingsproducedbytheeconomistIntelligenceunitranked

Norwayhighly(11thoutof68countries)intermsofprovidinganenvironmentconducive

totheemergenceofe-business.Othere-commercestatisticsofNorwayinclude22:

•percentageofhouseholdswithInternetaccess:69%(2006)

•percentageofenterpriseswithInternetaccess:86%(2004)

•percentageofindividualsusingtheInternetatleastonceaweek:77%(2006)

•percentageofhouseholdswithabroadbandconnection:57%(2006)

•percentageofenterpriseswithabroadbandconnection:86%(2006)

•percentageofindividualshavingpurchased/orderedonlineinthelastthree

months:47%(2006)

•percentageofenterpriseshavingreceivedordersonlinewithinthepreviousyear:

28%(2006)

thesuccessesofquiteafewNorwegiane-companies,suchas“Norwegian”(airliner),

“platekompaniet”(music),and“fastsearchandtransfer”(searchengines),canbeattrib-

utedtoNorwegianmarketcharacteristicswhereconsumershaveanunusuallyhighapti-

tudeforItknowledgeandaheartyappetiteforconsumerelectronics.

AsamemberoftheeeA,Norwayhasnotfullyimplementedthebody’se-Commerce

specifications.however,Norwayhasenactedanationale-CommerceActwhichsupports

muchofeeA.

Opportunities for future cooperation

ApossiblebilateralftAwouldprovideanopportunitytoenhancee-commercecoop-

erationbetweenChinaandNorway.undertheframeworkofthefutureftA,Chinaand

Norwayshouldmakejointeffortstoestablishaframeworkthatcouldensurethesound

22 source:eurostat.

http://epp.eurostat.ec.europa.eu/portal/page?_pageid=1996,45323734&_dad=portal&_schema=PORTAL&screen=welcomeref&open=/I/I5&language=en&product=Yearlies_new_science_technology&root=Yearlies_new_science_technology&scrollto=0


developmentofe-commerceinbothofthetwocountriesandconsistencywithexisting

multilateralandregionaltraderulesandnormswithabearingone-commerce.

AreasforcooperationunderthefutureftAthatcouldbefurtherexploredinclude:

•minimisationoftheregulatoryburdenone-commerce;

•consistencywithexistingmultilateralandregionaltraderulesandnormswith

abearingone-commerce;

•effectivedataandconsumerprotection;

•cooperationinthedevelopmentofpaperlesstrading;and

•implementationofrelatedcapacitybuildingandhumanresourcedevelopment

projectsforawiderapplicationofe-commerce.

5.3 Sanitary and phytosanitary measures (SPS)

theWtOAgreementontheApplicationofsanitaryandphytosanitarymeasures(sps

Agreement)establishestheinternationalrules-basedframeworkfordevelopingand

adoptingspsmeasures.thespsAgreementacknowledgestherightofmembersto

undertakemeasurestoprotecthuman,animalorplantlifeandhealth.Itrequiresthat

suchmeasuresshouldnotbeusedtorestricttradeunnecessarily,arebasedonscien-

tificprinciplesandarenotmaintainedwithoutsufficientscientificevidenceoravailable

pertinentinformation.

China

sinceaccessiontotheWtO,Chinahasestablishedaspsnotificationauthorityanda

spsenquirypoint.ChinahascommittedtocomplywiththespsAgreementandensure

conformitywiththespsAgreementofallitslaws,regulations,decrees,requirementsand

proceduresrelatingtospsmeasures.WiththeboomingofChina’simportsandexports

ofagriculturalproductsandfood,therelevantspsmeasuresaretobestrengthenedto

preventtheoutbreakofexistingoremerginginfectiousdiseasesorpestsandtoprevent

thecontaminatedfoodwithtoxicsubstancestoprotectthehuman,animalandplantlife

orhealth.

thegeneralAdministrationofQualitysupervision,InspectionandQuarantineofthe

people’srepublicofChina(AQsIQ)isalaw-enforcementadministrativeorganofthe

stateCouncilinthefieldofquality,metrology,entry-exitcommoditiesinspection,entry-

exithealthquarantine,entry-exitanimalandplantquarantine,supervisionoffoodsafety,

certificationandaccreditationandstandardization.Itisthekeygovernmentauthority

inchargeofentry-exitanimalandplantquarantineandfoodsafety,whicharethethree

mainissuescoveredbythespsagreementoftheWtO.thenationalspsenquirypointof

ChinaisestablishedinAQsIQ.


theCertificationandAccreditationAdministrationofthepeople’srepublicofChina

(CNCA)isresponsiblefortheregistrationsystemoffoodmanufacturingandprocessing

establishments.theregistrationrequirementappliestobothimportingandexporting

establishments.Withregardtoimport,CNCA,accordingtotheregulationsfor

AdministrationofregistrationofforeignfoodestablishmentIntendedtobeImported

intoChina,isauthorizedtoregisterforeign-locatedenterprisesthatproduce,processor

storefoodstuffsdestinedforChina.Allforeignestablishmentsexportingfoodlistedon

theImportedfoodCatalogueforestablishmentsregistrationmustapplytoCNCAfor

registration,whichmeansthatfoodlistedonthecataloguewithoutregistrationisnot

allowedtobeexportedtoChina.

thestandardizationAdministrationofthepeople’srepublicofChina(sAC)isauthor-

izedbythestateCounciltoexercisetheunifiedmanagementofstandardisationworkin

China.Itisresponsiblefordraftingthestandardisationlawsandregulations,formulating

thelong-termdevelopmentprogramsandshort-termworkingplans.sACisalsorespon-

siblefortheexamination,approval,numberingandpublicationofnationalstandards,

andfortheregistrationandguidanceofsectorstandards,localstandardsandcompany

standards.ItalsorepresentsChinaintheInternationalOrganizationforstandardization

(IsO),theInternationalelectro-technicalCommission(IeC)andotherinternationaland

regionalstandardisationorganisations.

AQsIQisalsoresponsibleforconductingriskanalysisoftheentry-exitofplantsand

animalsandfoodsafety.Chinesemeasuresarescience-basedandproperriskassess-

mentsarecarriedoutaccordingly.AQsIQwilldeterminewhethertherelatedagricultural

productsandfoodaretobeallowedforimportsandexports.Asaresult,theimportedor

exportedproductsholdhighhygienicandhealthstandards.AQsIQwillestablishinspec-

tionandquarantinerequirementsfortheimportingorexportingproducts,aswellas

negotiatewithrelatedgovernmentauthoritiesofothercountriesongeneralspsissues

ordetailedinspectionandquarantinerequirementsforspecificproducts.tostandardise

theriskanalysisprocedure,AQsIQhasreleaseddetailedadministrativeregulationson

science-basedriskanalysisforanimalandplantquarantine,takingtherelatedstandards

oftheWorldOrganizationforAnimalhealth(OIe)andtheInternationalplantprotection

Convention(IppC)asreference.

Non-discriminationisoneofthecoreprinciplesfollowedbyChineseauthoritiesinthe

implementationoftheWtOsspsAgreement.thelocalspsauthoritiesaredirectlymoni-

toredbytheAQsIQtoensurethatspslawsandregulationsareuniformlyadheredto.

Norway

NorwayhascommitteditselftotherightsandobligationsinthespsAgreementsince

itenteredintoforcein1995.theworkandresultsoftheactivitiesofthestandardbody

settingorganisations,andinparticulartheCodexAlimentarius(COdeX),theWorld

OrganisationforAnimalhealth(OIe)andtheInternationalplantprotectionConvention

(IppC),playacrucialroledrawingupregulationsinthisfield.


Norwayisfreeofmanypestsanddiseasescommonlyfoundinothercountries,i.e.food-

bornediseasesandzoonoses.thusNorwayappliesahighlevelofprotectioninrelation

toimportsandinternationaltradeinplants,animalsandfoodstuffs.thelevelofprotec-

tionmustbeseeninrelationtofreedomstatusobtainedbyinternationallyrecognised

surveillanceandcontrolprograms.examplesareresidueplan,freedomand/orcontrol

plansfortuberculosis,brucellosis,Newcastledisease,bse/tse,salmonella,campylobacter,

severalfishdiseasesandplantpests(afullydetailedlistcanfoundintheannualreport

fromtheNorwegianfoodsafetyAuthority).Ingeneral,restrictionsmaybeappliedon

importswheresuchsurveillanceandcontrolprogramshavebeenestablished.

Norwegianmeasuresarescience-basedandproperriskassessmentsarecarriedout

accordingly.Asaresult,Norwegianproductsholdahighhygienicandhealthstandard.

riskassessmentsonadailybasisarecarriedoutbytheNorwegianfoodsafetyAuthority,

butparticulardifficultandsensitiveissuesareputforwardtotheNorwegianscientific

Committeeforfoodsafetyforevaluation.thelevelofprotectionisdeterminedatpolit-

icallevelintherelevantministries.

themainpartofNorwegianspsmeasuresareharmonisedwiththeeulegislation

throughtheeeAAgreement.Animportantexceptionistheplanthealthlegislation.even

iftheseregulationsarenationalregulations,themainelementsarebasedonthesame

principlesastheeulegislation.theobjectiveoftheseprinciplesistosecureproduction

andtradeofplantsandpropagationmaterialwiththebestpossiblehealthandsatisfac-

toryquality.thisincludesmeasuresnecessarytopreventtheintroductionandspreading

ofpestswhichhasharmfuleffectontheplants.

Norwegianregulationsinthefoodsafetyareaareharmonisedwiththeeuregula-

tionsthroughtheeeAAgreement.theseregulationsarenotonlyequivalenttotheeu

regulations,butidentical,correspondingtotheobligationsoftheeumemberstates.

eeAregulationscoveralsothirdcountrylegislation,includingsafeguardmeasures.Asa

non-memberoftheeu,Norwaymayincertaincasesadoptnationalsafeguardmeasures

correspondingtoanimmediatethreatwhichdepartfromtheadoptedeumeasures,but

thatisnotcommonlydone.forthetimebeingnosuchnationallegislationisinforce.

theresponsibilityforsps-regulationsatthepoliticallevelisdividedbetweenthree

ministries,dependingontheproductsandstageofprocessing:theministryofhealth

andsocialCare,theministryoffisheriesandCoastalAffairsandtheministryofAgricul-

tureandfood.themanagementandexecutiondutiesarecoveredbyonesinglebody,

theNorwegianfoodsafetyAuthority,whichcoversthewholefoodchainfromfarmto

fork.theministryofAgricultureandfoodisresponsibleforcoordinatingadministra-

tiveandbudgetarymattersforthatbody.regulationofdeliberatereleaseofgenetically

modifiedorganisms(gmO)istheresponsibilityoftheministryoftheenvironment.In

relationtoimportsandexportstheNorwegianfoodsafetyAuthorityistheresponsible

organfortheapplicationofimportcontrolsandissuingofexportcertificates.


theNorwegianspsnotificationpointistheministryofforeignAffairs,whilethesps

enquirypointistheministryofAgricultureandfood.thelatterministryalsocoordinates

theworkassociatedwiththeWtOssps-committeeaswellasspsmattersinfreetrade

agreementswithothercountries.


relationsbetweenNorwayandChinainthespsareahavedevelopedovertimeon

thebasisoffriendlyandconstructiverelations.Inordertofurtherthiscooperation,a

“memorandumofunderstanding”(mou)hasbeennegotiated,andafulltexthasbeen

developedattheadministrativelevel.thesignatoryceremonyofthememorandum

isexpectedtotakeplaceinthenearfuture.thepartiestothatmouarethegeneral

AdministrationofQualitysupervision,InspectionandQuarantineofthepeople’s

republicofChina(AQsIQ),andontheNorwegianside,theministryoffisheriesand

coastalAffairsandtheministryofAgricultureandfood.thescopeofthemouislimited

tothecompetencyoftherespectivepartiesmentioned.In2004,ChinaandNorway

agreedtocooperateinthefieldofseafoodsafetyandarepresentlyengagedinajoint

studyonlisteria.

thetwopartieshavealsometoccasionallyandinformallywithinthemarginsofthe

meetingsintheWtOsspscommittee.butalsointhisrespect,contactscouldandshould

easilyandconvenientlybedeveloped.

severaldelegationsfromChina,alsofromregionallevels,havevisitedNorway,mainly

forinformationpurposes,butalsofordiscussionsontheabovementionedmou.Norway

hasfoundthesevisitsveryinterestinganduseful.thevisitshavebeencarriedoutinthe

formofmeetingsandin-doorinformationsettings,aswellason-the-spotvisitsatcertain

premisessuchastheborderInspectionpostattheairportofOslo.similarmutualvisits

shouldbeencouragedinthefuture.

InthecontextofapossiblefreetradeagreementChinaandNorwaywouldhavethe

opportunitytostrengthencooperationonspsissuesandestablishcommonunder-

standingtorelatedprinciplesandimplementationmechanisms.

•theopportunitiesforbilateralcooperationmayinclude,butarenotlimitedto:

dealingwithspsissuesinaframeworkofenhancedconsultationandcooperation;

•improvingtheunderstandingofeachother’smeasuresandregulatorysystems;

•worktogethertoimprovespsoperationsandassociatedregulatorypracticesand

toaddressproblemsastheyarise;

•agreeingontheprinciplestobeappliedbybothsideswithrespecttoinspection,

testingandcertificationprocedures;

•workingtogethertoensurethatspsmeasuresorotherstandardsdonotresultin

unjustifiablerestrictionsontrade;and

•withoutprejudicetotheeeAAgreement,agreeingontheprinciplesofharmoni-

zation,equivalence,transparencyandregionalizationtoaddressrelevantspsissues.


5.4 Technical regulations and standards (TBT)

thedevelopmentofglobalizationhasmadetechnicalregulationsandstandardsan

importantcomponentoftheinternationaltradepolicyframework.Awidelyaccepted

internationalstandardssystemwillplayakeyroleinprotectingfairmarketcompetition,

expeditingtransactionofcommoditiesandthuspromotinginternationaltrade.

AsWtOmembers,bothChinaandNorwayfollowtheWtOAgreementontechnical

barrierstotrade(tbt),whichgovernstheformulationanduseoftechnicalregulations,

standardsandconformityassessmentprocedures.

China

Chinahasestablishedanationaltbtenquirypointinconjunctionwithimplementation

oftheWtOstbtAgreementandattachesemphasisparticularlytotheprincipleof

transparency.Chinahasbeenmakinggreateffortsinrecentyearstoremovetechnical

andregulatorybarrierstotrade,especiallyintheareasofstandardsandconformity

assessment,bytakingmeasuresconsistentwiththeWtOstbtAgreement.theadoption

ofinternationalstandardshasbeengreatlyincreased.

tostrengthenandunifytheadministrationofstandards,aswellascertificationand

accreditationactivities,theChinesegovernmentestablishedtheCertificationand

AccreditationAdministration(CNCA)andthestandardizationAdministration(sAC)

underthegeneralAdministrationofQualitysupervision,InspectionandQuarantineof

thepeople’srepublicofChina(AQsIQ)in2001toundertakethecertification,accredi-

tationandstandardsformulationworkrespectively.Chinahasalsoamendedand

adoptedaseriesofnewlawsandregulationsonstandardsandconformityassessment

proceduresinordertoimprovetheimplementationofitsWtOobligations.technical

regulationsandnationalstandardswillbereviewedandassessedeveryfiveyearsto

ensurethattheycomplywithArticle2.4ofthetbtAgreement.

Chinaimplementsaunitaryregulatorysystemforcertificationandaccreditationactivi-

tiesinaccordancewithRegulations of the People’s Republic of China on Certification

and Accreditation.tohonourthecommitmentsunderChina’saccessiontotheWtO,

AQsIQandCNCAmergedtheformertwocompulsorycertificationsystemsintoChina

CompulsoryCertification(CCC)system,whichequallyappliestoimportedanddomestic

products,andthetwoformerCCIbmarkandgreatWallmarkwerereplacedbythenew

CCCmarkin2002.AccordingtotheRegulations,productslistedintheCCCCatalogue,

whichisformulatedbyAQsIQandCNCA,aresubjecttocompulsorycertificationand

maybereleasedfromthemanufacturer,marketed,importedorusedforanycommercial

purposesonlyaftertheyarecertifiedbytheCertificationbodiesdesignatedbyCNCA

andhaveCCCmarkappliedasrequired.theRegulationsalsoprovidesthatacertification

bodymayengageincertificationactivitiesonlyafteritisapprovedbythestate’scertifi-

cationandaccreditationregulatoryauthority,CNCA.


Whileencouragingtheadoptionofinternationalstandardsandpracticesinformulating

andamendingnationalstandards,Chinaalsolooksintowaystostrengthenbilateral

ormultilateralcooperationonstandardsandconformityassessment.Chinaisafull

memberoftheInternationalOrganizationforstandardization(IsO),theInternational

electro-technicalCommission(IeC),theInternationaltelecommunicationunion(Itu),

CodexAlimentariusCommission(CAC),theInternationalAccreditationforum(IAf),

theInternationallaboratoryAccreditationCooperation(IlAC),andtheInternational

personnelCertificationAssociation(IpC),andhasbeenactivelyparticipatinginthe

activitiesoftheseorganizations.

Norway

Norwayhasdevelopedanextensiveframeworkforaddressingstandardsandconform-

anceissues.standardsNorway(sN),theNorwegianelectro-technicalCommittee(NeK)

andtheNorwegianpostandtelecommunicationAuthority(pt)arethethreestandards

writingbodiesinNorway.

standardsNorway,responsibleforallstandardisationexceptforthosecoveredbythe

twootherbodies,adoptsandpublishessome1,500newNorwegianstandards(Ns)

annually,basedonnationallymadestandardsandoneuropeanandInternational

standards.standardsNorwayistheNorwegianmemberoftheeuropeanCommittee

ofstandardization(CeN)andIsO.

theNorwegianelectro-technicalCommitteeadoptsandpublishessome300new

standardsannually,andistheNorwegianmemberoftheeuropeanCommitteefor

electro-technicalstandardization(CeNeleC)andIeC.

theNorwegianpostandtelecommunicationAuthority(pt)isresponsibleforpost-and

telecommunicationstandardisationinNorway.Itsmajortasksarethecoordinationof

internationalandeuropeanworkinthisarea.ptistheNorwegiannationalmember

oftheeuropeantelecommunicationsstandardsInstitute(etsI)andtheInternational

telecommunicationunion(Itu).

NorwayhascommitteditselftotheWtOstbtAgreementsincetheentryintoforceof

theagreementin1995.Inadditiontomultilateralobligations,Norway’stbtpolicyis

constantlyformedtomirrordevelopmentsintheeu.

theeeAAgreementisregularlyupdatedinparalleltotheeClegislationwithinthescope

oftheAgreement.AsprescribedbytheAgreement,Norwaytakesappropriatemeasures

tofacilitatethesmoothfunctioningoftheAgreement.hence,restrictionsonimports

andexportsofgoodswithintheArea,isprohibitedcf.Article3,4,8,11–13.specific

provisionsandarrangementsarelaiddownintheAgreementsAnnexIIinrelationto

technicalregulations,standards,testingandcertification.


toremovebarrierstothefreecirculationofgoods,theeCandtheeeAeftAstatesuse

theNewandglobalApproachasoneofthemostimportantinstruments.23theapproach,

whichimpliesharmonisationofproductrequirementsandcertificationsystems,gives

europeanstandardsavitalroleandleadstoCe-markedproducts,whichmaycirculate

freelywithintheeeAArea.

About22productsectorsareharmonisedinaccordancewiththeNewandglobal

Approach.thegovernanceofthelegislationintheseproductsectorsisinNorwaydealt

withbydifferentministries.theministryoftradeandIndustryhasanoverallresponsi-

bilityforthewell-functioningoftheapproachassuch.


ApossibleftAbetweenChinaandNorwaywoulddevelopbilateralcooperationthrough

identifyingprinciples,disciplinesandproceduresfordealingwithtechnicalrequire-

ments,standardsandconformityassessmentthataffectbilateraltrade.theftAcould

alsopromotetechnicalcooperationandcapacitybuildinginthetbtarea,including

informationsharing,seminarsandexchangevisits.

InthecontextofapossibleftA,ChinaandNorwaywillhavetheopportunity:

•toencouragewiderapplicationofinternationalstandardsthroughbilateral

cooperation;

•toidentifyandeliminateexistingunjustifiedtechnicalbarrierstopromotebilateral

trade;

•toimproveinformation-exchangemechanismsbetweentherelatedgovernment

authoritiesofthetwocountriesandtoenhancetransparencyintheregimeof

technicalregulations,standardsandconformityassessment;

•tostrengthencooperationonmutualrecognitionofconformityassessment;and

•tocarryoutbilateralcooperationinthefieldoftechnicalregulations,standards

andconformityassessment.

5.5 Intellectual property rights (IPR)

Intellectualpropertyrightsprotectionisakeyfactorinfacilitatingeconomicdevelop-

mentandinternationaltrade.theestablishmentandmaintenanceofeffectiveintellec-

tualpropertyrightsregimesprovidesincentivestoinnovateandtodisseminateideas

andinformation.Intellectualpropertyrightsalsohelpcreatinganattractiveenvironment

forinvestmentandtechnologytransfer.hence,intellectualpropertyrightsareofcrucial

importanceinstimulatinginvestmentininnovation.theirimportancewillcontinueto

growastheglobalknowledgeeconomyevolves.

23 Aguidetotheapproachisfoundonthefollowingwebsite:http://europa.eu.int/comm/enterprise/newapproach/legislation/guide/legislation.htm

http://europa.eu.int/comm/enterprise/newapproach/legislation/guide/legislation.htm

http://europa.eu.int/comm/enterprise/newapproach/legislation/guide/legislation.htm


China

Chinaregardsprotectionofintellectualpropertyrightsasanimportantcomponentof

itsreformandopeningpoliciesandlegalframework.sincethe1980s,Chinahaspromul-

gateddozensoflawsandregulationsforIprprotectionincluding,i.a.thetrademarklaw,

patentlaw,Copyrightlaw,regulationsforprotectionofComputersoftware,regulations

forpenalizingAnti-IprCrimes,andregulationsforCustomsprotectionofIpr.Acompre-

hensivelegalsystemofIprprotectionhasbeenestablished.

ChinaattachesimportancetoenhancingpublicawarenessofIprprotection.measures

takenincludeholdingseminars,producingtVprograms,publishingbooks,andsoon.

therelevantauthoritiesalsoprovidetrainingonIprprotectionwithrespecttoofficials,

headsofenterprisesandtechnicians.sinceitsaccessiontotheWtOindecember2001,

Chinahasattachedhighpriorityonintellectualpropertyrightsinconformitywithits

obligationsasamemberoftheWtO.morestringentpenaltiesforintellectualproperty

infringementhavebeenimplemented,togetherwithalarge-scalecampaignagainst

piracyandcounterfeiting.

WhilemakinggreateffortstoimprovethedomesticlegalframeworkforIprprotection,

Chinahasalsoengagedactivelyinactivitiesofrelatedinternationalorganizations,and

strengtheneditscooperationandexchangeswithothercountriesinthefieldofIpr

protection.

Norway

Norwegianlegislationcoverspatents,trademarks,designs,geographicalindications

andplantvarietyrights,aswellascopyrightandprotectionofcompilationsofdata.

enforcementprimarilytakesplacethroughcivilactiontakenbyrightholdersthrough

thecourts.AnewprovisionhasrecentlybeenintroducedintotheCustomsActinorder

tofacilitateenforcement.theprovisiongivesCustomsauthoritiesincreasedaccessto

temporarystopconsignmentsofmerchandisesuspectedofcontainingcounterfeitor

piratedgoodsattheborders.thiswillmakeNorwegianbordercontrolmeasuresmore

effective.

NorwaybecameamemberoftheeuropeanpatentOrganisation(epO)on1January

2008,andcontributesactivelytotheactivitiesconductedundertheauspicesoftheepO.

referenceismadetotheepO-sIpOstrategicpartnershipAgreementthatwasconcluded

inJune2007.

theNorwegiangovernmentispreparingaWhitepaperonInnovationtobepresented

fortheparliamentin2008.measuresinthefieldofintellectualpropertyrightsaregoing

tobeoneofthefocusareas.CompetencebuildingandraisingawarenessintheIprfield

amongNorwegianenterprises,especiallysme’s,maybeoneofthefocusareasinthe

Whitepaper.


furthermore,thegovernmentfocusesincreasinglyonmeasurestofacilitateeffective

enforcementofIprights,bothinNorwayandabroad.Onegoalistomakesurethatsmes,

too,caneffectivelyenforcetheirrights.

Norwayalsoendeavourstoactasabridge-builderbetweenNorthandsouthininter-

nationalforawhereIpr-mattersarediscussed,suchastheWorldIntellectualproperty

Organisation(WIpO),theWtOtrIps-Council,theConventiononbiodiversity(Cbd),the

WorldhealthOrganisation(WhO),thefoodandAgricultureOrganisation(fAO)and

others.

Opportunities for Future Co-operation

ChinaandNorwayarebothmembersoftheWorldIntellectualpropertyOrganisation,

andpartiestotheWtOAgreementontraderelatedAspectsofIntellectualproperty

rights(trIps).Accordingly,bothcountriesmaintaincomprehensivelegalframeworksfor

theprotectionofintellectualpropertyrights.

AnftAcouldhelpstrengtheningcooperationbetweenChinaandNorwayinthefieldof

Iprprotection,i.a.byinformationandknowledgeexchangebetweenthetwocountries

regardingtheirrespectiveandIprlegalframeworksIprpolicyregimes.

ChinaandNorwayagreedintheJointstudygrouptofurtherexplorecooperationunder

anftAinthefollowingareas:

•strengtheningcooperationontheimplementationofintellectualpropertyrights,

includinginrelationtolegal,administrativeandimplementationprocesses;

•exchanginginformationonnationallegislationandaccessiontointernational

treaties;

•establishingcooperativemechanismstosettleproblemsidentifiedintheintel-

lectualpropertyrightsarea,inthefirstinstancethroughregularclearingofIpr-

relatedmattersintheChinese-NorwegianJointeconomicCommission;and

•cooperativeactivitiesundertheepO-sIpOstrategicpartnershipAgreement

concludedinJune2007.24

5.6 SME Cooperation

smallandmediumsizedenterprises(smes)areanimportantcomponentofboththe

ChineseandNorwegianeconomies,bothintermsoftheirnumberandtheproportion

ofthelabourforceemployedbythem.Inrecentyears,smesinChinaandNorwayare

becomingmoreactivelyinvolvedininternationalbusinessactivities,andaccordingly

couldbeexpectedtotakeadvantageoftheopportunitiescreatedbythefutureftA.

24 AwholerangeofcollaborativeactivitiesisdrawnupintheAgreement,tobeagreedmorespecificallyinthemonthstocome.Norwaypointedi.a.toArticle32oftheAgreementthatstates,“thetwoOffices(epOandsIpO)willjointlydrawupannualworkprogrammesthatwillsetoutthespecificaspectsoftheircollaboration.”


ItisimportanttonotethattherearedifferencesinthedefinitionsofsmesinChinaand

Norway.

AccordingtotheChinesegovernment,smesareroughlycharacterizedashaving

lessthan200employees(withtheexceptionof3000employeefortheconstruction

industry),withsalesvaluelowerthanrmb300million(us$40million)orcapitalvalue

lowerthanrmb400million(us$53.3million).

smeshavegrownrapidlyduringthepasttwodecadesinChinaandhavemadesignifi-

cantcontributiontothenationaleconomy.byOctober2006,thenumberofsmes

reachedto42million,accountingfor99.8%ofthetotalnumberofChina’senterprises.

thevalueoffinalproductsandservicescreatedbysmesaccountsfor58%ofChina’s

gdpandabout70%ofChina’stotalvalueofexports.25smesalsoplayaveryimportant

roleinexpandingemployment.theyprovideabout80%ofthetotalurbanemployment

inChina.

topromotesino-foreignsmescooperation,ChinaestablishedtheInternationalCoordi-

nationCentreforsmesin1985andtheInternationalCooperationAssociationofsmesin

1990.besidesinstitutionalconstruction,theChinesegovernmenthasalsoenhancedsme

developmentthroughlegislation.thepromotionlawofsmallandmediumenterprises

waspromulgatedinJune2002andcameintoforceon1January2003.thislawaimsto

promotethehealthydevelopmentofsmesbyestablishingmechanismstopromotefair

marketcompetitionandencouragingsmestoactivelyparticipateininternational

cooperation.

Asanimportanteventaimingtopromotesino-foreignsmescooperation,ChinaInter-

nationalsmall&medium-sizedenterprisesfairisheldtwiceayearinspringandautumn

sinceitwassuccessfullyheldintheautumnof2006.Itisthelargestsmestradefairofthe

highestlevel,ofthemostcompletevarietiesandofthelargestattendanceandbusiness

turnoverinChina.

Norwayuseseu’sdefinitionthatdefinesasmeasacompanywithlessthan250

employees,annualturnoverlessthanus$70millionandwithabalancesheetofless

thanus$60million.smesaccountforthevastmajorityofNorwegianenterprisesand

makeanimportantcontributiontoemploymentandeconomicgrowthofNorway.the

significanceofsmestoNorway’seconomyhasbeenincreasing,withfurtheropportuni-

tiespresentedbyglobalisationandtechnologicaldevelopment.therefore,tosupport

thedevelopmentofsmeshasalwaysbeenonthetopagendaoftheNorwegiangovern-

ment.

theministryoftradeandIndustryhasorganizedthemajorityofitssupporttosmes

throughtheresearchCouncilofNorway(Nfr)andInnovationNorway(IN).Nfrand

INalsocarryouttasksrelevantforsmesforotherministriesandlocalgovernmental

actors.Itisintheinterestofsmesthatfeworganisationsarecarryingouttasksforseveral

25 source:ChinasmesInformationNetwork,www.sme.gov.cn.

http://www.sme.gov.cn


publicbodies,sincesuchasystemiseasytounderstandanduser-friendly.Nfrsupports

researchactivitiesinpublicinstitutionsandprivatefirms.INsupportinnovationactivities

andestablishmentofnewfirms.OneofthemaintargetgroupsforINsactivitiesissmes.

underthemanagementandcoordinationoftheseinstitutions,anumberofgovern-

mentalprogrammeshavebeenestablishedtosupportthedevelopmentofsmes.some

programmesaretargetedatspecificindustriesorindustrialsectors,whileothersare

targetedatspecificgeographicallyconfinedareas.


ApossibleftAwouldnotonlycreatemorebusinessopportunitiesforthesmesofChina

andNorwaytoentereachother’sdomesticmarket,butalsoprovideawiderscopefor

futurebilateralsmescooperation.tohelpensurethatsmesembracethebenefitsofan

ftA,ChinaandNorwaycouldconsider:

•exploringjointlythestrategyandsupportpolicyforthedevelopmentofsmes,

includingensuringthathorizontalrulesdonotdiscriminatesmesbyfavouring

largecompanies;

•promotingcooperationandinformationexchangebetweengovernmentinstitu-

tions,chambersofcommerce,andindustrialassociationsofthetwocountries;

•holdingtradefairsandinvestmentmartsincooperationforsmesofthetwocoun-

tries;and

•reinforcingtrainingandpersonnelexchangebetweensmesofthetwocountries.

5.7 Temporary movement of natural persons

movementofnaturalpersonsbetweenChinaandNorwayisanecessarypartofthebi-

lateraltradeandisessentialtobuildandstrengthenbusinessties.therefore,facilitating

themobilityofnaturalpersonswillpromotebilateraltradeandinvestment,andhelp

ChineseandNorwegianindustryidentifynewopportunitiesarisingfromanftA.

China

Inrecentyears,Chinahasimprovedtheregulationsandpoliciesontemporaryentryof

foreignnationalsinordertofacilitatetheirvisitstoChina.Chinahasarrangeddifferent

typesofvisaandvisa-extensionprocedurestofacilitateforeignnaturalpersons’short

tripstoChina,andstayofadurationofmorethanoneyear.toenterChina,foreign

nationalsshouldapplyforaVisaf,ifhe/shewishestomakeatemporarybusinesstrip;

oraVisaZ,ifhe/sheistoresideinChina.Inaccordancewiththelawofthepeople's

republicofChinaontheentryandexitofAliens,alienswhowouldliketoenterinto

ChinashallapplyforvisastotheChinesediplomaticmissionsorconsularpostsorother

agenciesabroadauthorizedbyministryofforeignAffairsofthep.r.C.theentryof

nationalsfromacountryhavingvisaagreementwiththeChinesegovernmentshall

bedealtwithinaccordancewiththesaidagreement.


theregulationsonexaminationandApprovalofpermanentresidenceofAliensin

ChinawasimplementedinAugust2004.“residencepermit”wasintroducedinsteadof

“Aliens’residencecredential”inseptember2004.With“residencepermit”,thealiencan

stayinChinawithmultipleentrypermissionintheperiodofvalidity.

Atthesametime,electronicmeanshavebeenincreasinglyappliedinvisaadministration

andpassengerclearanceprocedures.machine-readablevisasareintheprocessofbeing

introduced.thismeasurewillgreatlyreducethewaitingtimeforforeignbusinessper-

sonsatChineseportsofentry.

Norway

19december1996Norwaysignedthecooperationagreementwiththeschengencoun-

tries.duetoorganisationalchangesineuin1997,wherebytheschengencooperation

wasintegratedineu,Norwaysignedanassociationagreementwitheu18ofmay1999.

Norwaybecameoperativemembertotheschengencooperationinmarch2001,and

istherebyobligedtoimplementandapplytheschengenlegislationintheareaofvisa

policyandlegislation.Astandardschengenvisaisvalidforallschengenmemberstates

duringthevalidperiodofthevisa,uptomaximum90daysper180days.Anystayin

Norwayexceeding90days,requireawork-orresidencepermit.Applicationsforthisshall

belodgedtotheNorwegianembassy,whichwillforwardtheapplicationforworkor

residencepermittotheNorwegiandirectorateofImmigrationwhichisresponsiblefor

thehandlingoftheapplications.

toobtainaschengenvisathereareseveralrequirementstobefulfilled.therequire-

mentsofforinstancedocumentationofthepurposeofthejourneyandsufficientmeans

mayvaryfromcountrytocountry,accordingtothevariouspracticalcircumstances.

theschengenmemberstate’slocalconsularposts,shallcooperateinordertoobtain

aharmonisedapplicationoftheschengenlegislation.AttheNorwegianembassyin

beijing,therequirementsforastandardschengenvisaare;allnationalswhowishto

enterNorwaymustmeettherequirementsoftheImmigrationrules.therearemainly

threedifferenttypesofvisastoapplyfor(businessvisa,familyorfriendvisitvisaand

touristvisa).theprocessingtimefortherespectivevisasisindicatedbelow:

businessvisa:upto10workingdays

familyorfriendvisit:uptofourmonths

touristvisa(undertheAdsAgreement):upto15workingdays

Opportunity for future cooperation

ChinaandNorwayrecognizetheimportanceofmakingiteasierfornaturalpersonsto

movebetweentheirtwocountries.furtheropportunitiesforfacilitatingmovementof

naturalpersonswillbeconsideredinthecontextofthefutureftA.

WiththeestablishmentofanftAbetweenChinaandNorway,naturalpersonswilltravel

betweenthetwocountriesmorefrequently.easeoftravelfornaturalpersonsbecomes

isakeyelementforfacilitatingandencouraginggreaterbilateraltradeandinvestment


links.Consequently,thevisaauthoritiesofthetwocountriesshouldstrengthencoopera-

tionandinthecontextoftheftAnegotiationsfurtheroptionstofacilitatetheissuing

ofvisaswillbeexplored.theftAbetweenChinaandNorwaycouldalsoprovidefora

widerangeofspecificstepstostrengthenbilateralcooperationonmobilityofnatural

persons.

5.8 Trade and investment promotion

Inanageofglobalisation,internationaltradeandinvestmentarebecomingmore

andmoreimportantforacountry’seconomicdevelopment.Inrecentyears,tradeand

economicrelationsbetweenChinaandNorwayhavemadegreatprogress,butthe

volumeofbilateraltradeandinvestmentisrelativelysmallcomparedwithrealdemands

andpotentialofbothcountries.therefore,cooperationontradeandinvestmentpromo-

tionbetweenChinaandNorwaywillbeanissueofgreatsignificanceundertheframe-

workofthefuturebilateralftA.

China

theChinesegovernmenthasalwaysbeenattachingimportancetotradeandinvest-

mentpromotionandmakinggreateffortstocreatenewopportunitiesoftradeand

investmentforenterprisesinallsectors.establishedinmay1952,China’sCouncilforthe

promotionofInternationaltrade(CCpIt)iscomprisedofenterprisesandorganisations

representingtheeconomicandtradesectorsinChina.Itisthemostimportantandthe

largestNgOforforeigntradeandinvestmentpromotioninChina,withthemainaimto

conductsino-foreigneconomicandtechnologicalcooperationthroughvariousactivi-

tiesoftradeandinvestmentpromotion.

Inthemid1980s,foreignInvestmentserviceCentreswereestablishedinmanycities

throughoutChina.WiththesupportofmOfCOm,theChinaInternationalInvestment

promotionCenter(CIIpC)wasestablishedinAugust2001.InitiatedbyCIIpCand15local

investmentpromotionagencies,thefederationofInvestmentpromotionAgenciesof

China(fIpAC)wassetupinmarch2002.twootherimportantgovernmentinstitutionsin

chargeoftradeandinvestmentpromotion,theexecutivebureauofInvestmentpromo-

tionofmOfCOmandthetradedevelopmentbureauofmOfCOm,wereestablished

respectivelyinmarchandJuneof2003.sincethen,ledandcoordinatedbymOfCOm,

acomprehensivenation-widetradeandinvestmentpromotionnetworkhasbeenestab-

lishedinChina.

Atpresent,theannualChinaexportCommoditiesfair,ChinatradeandInvestmentfair,

ChinaNewandhightechnologiesfairandChinaInternationalsmall&medium-sized

enterprisesfairhaveconstitutedanation-levelframeworkoftradeandinvestment

promotion.furthermore,organisationsattheprovinciallevelhavebeenestablishedto

implementtradeandinvestmentpromotionactivitiesinaccordancewiththeneedsof

localeconomicdevelopment.


Norway

theministryoftradeandIndustryhastheoverallresponsibilityforNorway’sindustrial

policy.Norwayisanopeneconomyandconsequently,internationalisationformsasignif-

icantpartoftheindustrialpolicyandapriorityforthegovernment.Otherministrieslike

theministriesofforeignAffairs,finance,fisheryandCoastalAffairs,energyandpetro-

leumandeducationandresearcharealsoimportantactorsinthisregard.

theministryoftradeandIndustryisresponsibleforpublicsupportsystemsinNorway

thatsupportsNorwegiancompanies.theinternationalpartofthepublicsupportsystem

includesinparticularforexportcredits;gIeKandeksportfinansandInnovationNorway

whohasmanyresponsibilitieswithregardtosupportingcompaniesabroadandat

home.

InvestmentpromotioninNorwayismainlyundertakenbyInnovationNorway.

Asof1January2004,InnovationNorwayassumedthedutiesoftheNorwegianIndustrial

andregionaldevelopmentfund(sNd),theNorwegiantradeCouncil,theNorwegian

touristboardandthegovernmentConsultativeOfficeforInventors(sVO).

InnovationNorwayaimstopromotenationwideindustrialdevelopmentprofitableto

boththebusinesscommunityandNorway’snationaleconomy,enhancethecompeti-

tivenessandprofitabilityofNorwegianenterprisesininternationalmarkets,andto

helpreleasethepotentialofdifferentdistrictsandregionsbyenhancinginnovation,

internationalisation,promotingNorwegianbusinessesabroad,andpromotingNorway

asatouristdestination.forthepurposeoftradeandinvestmentpromotion,Innovation

Norwayassistscustomersthroughtheentireexportandinternationalisationprocess,

actingasastrategicadviser,dooropenerandproblem-solver.Jointpromotionsinclude

exhibitions,delegationsandcampaignstopromoteNorwegiancompaniesabroad.At

present,InnovationNorwayhasofficesinalltheNorwegiancountiesandinmorethan

30countriesworldwide,includingofficesinbeijingandshanghai.theheadofficeis

locatedinOslo.

theConfederationofNorwegianbusinessandIndustry(NhO)andOsloChamberof

Commerce(OCC)havealsobeenplayinganactiveroleinNorwegiantradeandinvest-

mentpromotion.


ChinaandNorwayhavealreadycarriedouteffectivecooperationontradeandinvest-

mentpromotionundertheframeworkofthesino-NorwegianmixedCommission

foreconomyandtrade,establishedin1980.Asub-committeetothecommission,for

promotingbilateralinvestments,wasformedinseptember2006.theestablishment

ofanftAwillfurtherenhancebilateralcooperationontradeandinvestmentpromotion

byallowingthetwocountriestobettersharetheirsuccessfulexperiencesinthisfield.

Areasforfuturecooperationcouldinclude:


•strengtheningcooperationonhumanresourcedevelopmentandexpertise

relatedtotradeandinvestmentpromotion;

•enhancingcooperationbetweennon-governmentalorganizations,especially

guildsandchambersofcommerceofthetwocountries,aswellasensuringthat

rulesforchambersofcommercearenotahindrancefortheirformalestablishment;

and

•creatingopportunitiesforbusinessestobenefitfromtradeandinvestment

promotionactivities,suchastradefairsandinvestmentmarts.

5.9 Environment and technology cooperation

thegovernmentsofChinaandNorwayrecognisetheimportanceofaddressingenviron-

mentalchallengeswhilststrivingforcontinuedeconomicdevelopment.environmental

technologiesplayakeyroleinthis,asthesetechnologiesaddresspresentenvironmental

problemswhilstbeingapartofeconomicgrowth.giventheimportanceofsecuring

sustainabledevelopment,NorwayandChinawishtocontinuetheircooperationinthe

fieldofenvironmentandtechnology.theireffortsincludeencouragingthedevelopment

ofacommercialmarketforenvironmentaltechnologiesandofcommercialactorswithin

thisfield,oneexampleoftheinitiativesthathasbeenmadebeingtheestablishmentof

theNorwegianenergyandenvironmentConsortium(NeeC).bothgovernmentswelcome

otherinitiativesencouragingcommercialcooperationonenvironmentaltechnologies.

furthermore,bothChinaandNorwayrecognisethepivotalroleofenforcingenviron-

mentalregulationstocreateamarketforenvironmentaltechnologies.environmental

policiesandregulationscreatebusinessopportunitiesforenvironmentaltechnologies

andservices,andisanimportantdrivingforcefortechnologyinnovationandtransfer.

Asuccessfulcooperationontheenvironmentthroughabilateralmemorandumof

understanding(mou)betweenChinaandNorwayhasbeenongoingformorethana

decade.theworkhasfocusedonclimatechangeissues,hazardouschemicals,biodiver-

sityandairandwaterpollution,andhasaimedtoincreasecapacityonandstrengthen

theinstitutionsthatworkwiththeseissuesinChina.thecooperationprogramhasalso

includedeffortstointroduceNorwegianenvironmentaltechnologiestoChina.someof

theprojectsexecutedunderthemouhavecontainedelementsthatarehighlyrelevant

forafreetradeagreement,anexampleofthisbeingaprojectontheIsO14000standard

(projectnumberChN-0047).theoverallprojectaimwastoenableChineseindustry

andgovernmentadministrationatbothcentralandlocallevelstousethisinternational

standard.AsproductionprocessesconformingtotheIsO14000/14001standardmay

leadtofacilitatedmarketentranceandacompetitiveadvantageinwesternmarkets,

whilstnegativeenvironmentaleffectsofproductionarereduced,thisprojectcontrib-

utedtowardstheaimsofbothtradecooperationandtheenvironmentalmou.themost

recentreviewofthesino-Norwegiancooperationonenvironmentsuggestedthatthe

projectsunderthismoucouldbeusedasgatewaystofurthercommercialcoopera-

tion.Additionally,theWorkinggroupontradeandtheenvironmentundertheChina


CouncilforInternationalCooperationonenvironmentanddevelopment(CCICed)might

provideusefulinsightonhowtoaddressquestionsrelatedtotradeandenvironment.

bothChinaandNorwayencouragetheexplorationofcooperationactivities,hereunder

capacitybuilding,thatsupporttheintentionsofatradeagreementandenablefurther

stepstowardssustainabledevelopment.

thegovernmentsofNorwayandChinaaredeterminedtomakethegoodsandserv-

icestradedbetweenthetwocountriescomplywithhighstandardsfortheprotection

ofhumanhealthandtheenvironment.ItisrecommendedthatChinaandNorwayto

engageinfriendlyexchangeofinformationabouteachothers’systemsandstandards,

soastoensureanunderstandingoftheapplicablerulesineachcountry.

5.9.1 Environmental protection

China

theChinesegovernmenthasattachedgreatimportancetoenvironmentalprotec-

tion,makingitabasicnationalpolicy,whilstsustainabledevelopmentisanimportant

strategy.

In1998,theChinesegovernmentchangedthenameofthestateenvironmentalprotec-

tionbureautothestateenvironmentalprotectionAdministration(sepA),andelevated

ittotheministeriallevel.Inthepolicyregime,Chinahasformulatedorrevisedmajor

lawsonenvironmentalprotectioninthepastdecade,suchasthoseonpreventionand

controlofwaterpollution,marineenvironmentprotection,preventionandcontrolof

airpollution,aswellasevaluationofenvironmentalimpact.thestateCouncilhasalso

formulatedorrevisedmorethan50administrativeregulationstostrengthenenviron-

mentalprotection.Atpresent,thereareabout3,200environmentalprotectionadminis-

trationdepartmentsatdifferentlevelsalloverChina,with167,000peopleengagingin

environmentaladministration,monitoring,scientificresearch,publicityandeducation.

Whilemakinggreateffortstoimprovetheinstitutionalframework,Chinahasalso

investedheavilyinenvironmentalprotection.between2001and2005,forexample,the

investmentreachedus$14billion,whichwasmainlyusedtocontroltheduststorm

sourcesthreateningthecapitalarea,toprotectnaturalforestsandtoturncultivated

farmlandbackintoforestsorpastures.

Inthe11thfive-yearprogramforeconomicandsocialdevelopment(2006-2010),China

hasclearlysetforthitsmaingoalsforenvironmentalprotectionforthenextfiveyears:

by2010,whilethenationaleconomywillmaintainarelativelystableandfastgrowth,the

environmentalqualityofkeyregionsandcitieswillbeimproved,andthetrendtowards

ecologicaldeteriorationwillbebroughtundercontrol.theprogramalsorequires

energyconsumptionperunitofgdptodeclinewith20%,comparedwiththeendof

the10thfive-yearplanperiod.thetotaldischargedamountofmajorpollutantswillbe

reducedby10%,andforestcoveragewillberaisedfrom18.2%to20%.


Apartfromdomesticefforts,Chinahasalsoaccededtomorethan50international

conventionsonenvironmentalprotection,andhasbeenactiveinperformingthe

obligationsstipulatedintheseconventions,whichincludetheunitedNationsframe-

workConventiononClimateChangeanditsKyotoprotocol,themontrealprotocolon

substancesthatdepletetheOzonelayerandtheConventiononbiologicaldiversity.

Norway

theNorwegiangovernmentattachesgreatimportancetoenvironmentalprotection.

Norwaywasamongstthefirstcountriesintheworldtoestablishaseparateministry

fortheenvironmentin1972,incontextoftheunitedNationsConferenceonhuman

environmentinstockholm,sweden.theministryhassixsubordinateagencies;the

NorwegianpollutionControlAuthority,thedirectorateforNaturemanagement,the

directorateforCulturalheritage,theNorwegianmappingAuthority,theproductregister

(theAuthorities’CentralregisterofChemicalproducts),andtheNorwegianpolarInsti-

tute.theNorwegianpollutionControlAuthorityisresponsibleforsupervisoryactivities

pursuanttothepollutionControlAct,theproductControlActandtheirregulations.

Norwayissignatorytoseveralinternationalconventionsandagreementsontheenvi-

ronment,suchastheunitedNationsframeworkConventiononClimateChangeand

itsKyotoprotocol,theConventiononbiologicaldiversity,thestockholmConvention

onpersistentOrganicpollutants(pOps),therotterdamConvention,theConvention

onInternationaltradeinendangeredspeciesofWildfaunaandflora(CItes)andthe

montrealprotocolonsubstancesthatdepletetheOzonelayer.

5.9.2 Renewable energy exploitation

toohighemissionofgreenhousegases,causingglobalwarmingandclimatedeteriora-

tionatanacceleratedratefarbeyondourexpectations,seriouslythreatensthesustain-

abledevelopmentofourhumansociety.Newenergyresourceshavetremendouspoten-

tial,areenvironmental-friendly,aswellassustainable,andarethusimportantsourcesof

energyforharmoniousdevelopmentofnatureandthehumansociety.Confrontedwith

theincreasinglyunbalancedsupplyanddemandofthetraditionalsourcesofenergy,

andtheseverechallengeofglobalwarming,countriesallovertheworldoughtto

strengthentheexplorationandutilizationofthenewenergiesanditstechnologies.

ChinaandNorwayareindialogueaboutcreatingaspecialframeworkforcooperation

onclimatechangeissues,tobeknownasthe“frameworkAgreementforCooperation

anddialogueonClimateChange”.thiswillbeasignificantcommitmentthatmightfruit-

fullybereflectedinotherareasofsino-Norwegiancooperation.Withtheappropriate

provisions,afreetradeagreementmayprovidestimuliforcommercialcooperation

withintheareaofreducingemissions.thiswillbenefittheeffortstoaddressthechal-

lengeofclimatechangeandprovideimportantbusinessopportunitiesforbothChinese

andNorwegiancommercialactors.Carboncaptureandstorage(CCs)willmostlikely

beanimportantelementinthecooperation.CCsstandsoutasapromisingtechnology


thatcouldmitigatethereleaseoflargequantitiesofCO2totheatmosphereifapplied

onfossilfuel-firedpowerplants.Norwegianuniversitiesandresearchinstitutionshave

extensivecompetencepertainingtoCCs,withaspecialised,nationalprogramme,ClImIt,

forgaspowertechnologieswithCCs.

CooperationregardingtheCleandevelopmentmechanism;the‘frameworkAgreement

forCooperationanddialogueonClimateChange’,alsoemphasizesfacilitationofcooper-

ationthroughtheCleandevelopmentmechanism(Cdm).sinceChinaisamajorprovider

ofCertifiedemissionreductions(Cers),andNorwaywillhaveasubstantialdemandfor

suchassets,thiscooperationmaygainimportanceintheyearstocome.Astableand

predictableinvestmentandbusinessenvironment,simplifiedproceduresbothonthe

nationalandinternationallevel,aswellasfurtherenhancingthecredibilityoftheCdm

asamarketmechanismandatooltomitigategreenhousegasemissions,willbeof

importancetothoseinvolvedinthemarketsbothontheChineseandNorwegianside.

China

China,asamajorenergyoutputandconsumptioncountry,isnowfacingtheheavypres-

sureofenergyshortage.therefore,Chinahasnoalternativebuttoexploreandutilise

newsourcesofenergytorealisethesustainabledevelopmentofthenationaleconomy.

Withtheimplementationofthe11thfive-yearplanstartingin2006,thecentralgovern-

mentofChinaplacesgreateremphasisonenergysaving,emissionofpollutantsand

environmentalprotection.themedium-andlong-termenergydevelopmentprogram

issuedbytheChinesegovernmentin2007expresslystatedthatby2020,therenew-

ableenergywouldaccountforabout16%inthetotalenergyconsumption.thespecific

renewableenergytargetsby2020include:

•Wind:30gW

•solarpowerpV:1.8gW

•solarheater:300millionm2

•biomasspower:30gW

•biomassdiesel:2mt

•biomasssolidfuel:50milliontonnes

•smallhydropowerstations:80gW

China’s11thfive-yearplanpointsoutthatgreateffortshouldbemadetodevelopthe

sourcesofrenewableenergy,implementpreferentialfiscalandtaxationpolicies,invest-

mentandcompulsorymarketsharepoliciestoencouragetheproductionandconsump-

tionofrenewableenergy.therefore,thenewenergyandrenewableenergymarkethas

hugepotential,providingunprecedentedopportunitiestothenewenergycompanies

andinstitutionsathomeandabroad.

Asamilestoneforthecountry’senergysavingcampaign,China Renewable Energy Law,

issuedbyChinesepeople’sCongressonfeb.28,2005,becameeffectiveon1January

2006.thegoalofthelawistomeetshort-termenergyneedswhilestrengtheninglong-


termsustainabledevelopmentobjectives.thelawaimstoreduceairpollution,safe-

guardhumanhealthandtheenvironment,andprovidepowertooff-gridruralareasas

wellascontributetomitigatingclimatechange.thelawsynthesizesbasicprinciplesof

themarketeconomyandthepoliticalobjectivesofenergysecurity.Incentivepolicies

outlinedinthelawareintendedtoencouragethedevelopmentofrenewabletechno-

logiesandprovidemarketopportunitiesforrenewableenergycompaniessothatlocal

governments,energyenterprisesandthepubliccanpromoteandutilizerenewable

energy.

Norway

thestorting(parliament)setsthepoliticalframeworkfortheenergysectorandwater

resourcemanagementinNorway.theministryofpetroleumandenergy(mpe)has

overalladministrativeresponsibilityforthesesectors.AmongtheActsthatregulate

waterresourcemanagementaretheWatercourseregulationAct,theIndustrial

ConcessionAct,theWaterresourcesActandtheenergyAct.

Norwegianauthoritiessetatargetin2001ofsavingenergyandcontributetonew

environmentalenergythattogetherwillgiveminimum12tWhbeforetheendof2010.

Norwegianscientists,professionalsandtradeandindustryareamongtheleadingin

theworldwithinanumberofareasthatconcernrenewableenergysources.thisexpert

knowledge,combinedwithgoodeconomicframeworkconditionsandaccessibletech-

nology,shouldlaythegroundforahealthyexplorationofthoseofourresourcesthat

haven’tbeenexploitedupuntiltoday,anexplorationthatisbasedontradeandindustry.

Norwegiancompanieshavealongtraditioninestablishingactivitiesbasedonsociety-

relatedneeds.thereisreasontoexpectmanysmallandmiddle-sizedNorwegian

suppliersofequipmentandserviceswillbecomeinvolvedinthefuturewindpower,

wavepowerandbioenergyindustry.

Sino-Norwegian cooperation on renewable energy technologies

NorwayandChinaenjoyasubstantiveandfriendlycooperationinthefieldofrenewable

technologies.Inordertocementthiscooperationthegovernmentsofbothcountries

haveconcludedimportantagreements.

In1997aletterofIntentonCooperationondevelopmentinhydropowerbetween

ministryofWaterresources(mWr)andmpewassigned.In2006amouonenhancing

CooperationinenergyConservationandrenewableenergywassignedbetween

NationaldevelopmentandreformCommission(NdrC)andmpe.

AsthegovernmentsofChinaandNorwayarestrengtheningthetradeandeconomic

relationsbetweenthecountries,strengthenedcooperationwithinimportantrenewable

energynicheswouldbenefitsustainabledevelopmentinNorwayandChina.Areasof

NorwegianexpertiseinwhichChinaandNorwaymaywanttoexplorethepossibility

ofstrengthenedcooperationareasfollow:


Hydropower

Norwayalreadybasesthemainpartofstationarypowerproductionontherenewable

energysourcelarge-scalehydropower.Norwayisthesixthbiggestproducerofhydro-

powerintheworld,andtheinstalledcapacityis28300mWwhilsttheaverageproduc-

tioncapacityis120tWhperyear.Norwegiancompanieshaveagreatdealofexperience

inthedevelopmentandconstructionofhydropowerprojects.Norwayalsohasastrong

supplierindustrythatdeliversgoodsandservicestohydropowerconstruction,alsoat

theinternationallevel.theNorwegianhydropowerindustrydeliversturbinesandelec-

tromechanicalproductstoothercountries,andalsoconsultantserviceswithinplanning,

projectingandotherengineeringtasks.thereisalsoanincreasingdemandforNorwe-

giancompetenceinsystemoperationandpreparationforapowermarket.

Wind and wave energy

Norwayhaslargewind-andwavepowerrecoursesalongthelongcoastthataresought

tobeexploredandexploited.

Norwegiancompanieshaveextensiveexperiencefromoffshoreoilandgasactivitiesand

canutilisethisindevelopingoffshorewindandwavetechnologies.Norwegiancompa-

niesalsohaveuniqueexperienceinoperatingwindturbinesinharsharcticclimate.

someoftheNorwegiancompanieswithinthewindpowerindustryarescanwindthat

produceswindturbines,sWAyandNorskhydro(hywind)thathavedevelopedprojects

forfloatingwindturbinesandOwectowerwhichisdesigningfoundations(tripods)for

offshorewindpower.

sINtefenergyresearch,Instituteforenergytecnology(Ife)andtheNorwegianuniver-

sityofscienceandtechnology(NtNu)arecooperatingonwindpowerresearchand

development.

ApromisingtechnologyinNorwayisoffshorewindpowerfaroffthecoast.It’sfreeof

emissions,hardlycomesintocontactwithbirdlife,canbeplacedoutsidefishinggrounds

andshippinglanes,andwillbeoutofsightofthepopulation.severalNorwegiancompa-

niesareleadingthewayinthedevelopment,basedamongotherthingsonexperience

fromtheoffshoreoil-andgasindustry.

Norwegiancompaniesalsodoresearchtodevelopotherpotentialresourceslikewave

power,tidalpowerandsaltpower.

Solar energy

Norwegianindustryisamongthelargestproducersofsiliconfortheproductionofsolar

cellsintheworld,andstillexpanding.AnewfactoryinÅrdalstartsdeliveriesofsiliconat

theendof2007,anothernewfactorynearKristiansandstartsdeliveriesofsiliconin2008.

theproductionofsiliconisenergyintensive.Norwayhasalonghistoryofenergyinten-

siveindustrybecauseoftheabundanceofinexpensiveelectricitythroughhydropower

plants.Norwegiancompaniesarealsoactiveintheproductionofsolarthermalcollec-

tionsystems.


AmongtheNorwegiancompanieswithinthesolarindustryareelkemsolar,Norsunand

renewableenergyCorporation(reC).reCisactiveinthewholechainofactivitiesrelated

tosolarcellsandistheworld’sbiggestcompanywithinthesolarindustry.reCisunique

inthatitdeliversgoodsandservicesinthewholevaluechainforsolarenergy.reCisthe

world’slargestproducerof“solargrade”siliconandwafers,andaconsiderableproducer

ofsolarcellsandmodules.

Bio energy

Norwayhasgreatpotentialinincreasingtheutilizationofbioenergy,bothfordistrict

heatingplantsandasrawmaterialforbioethanol.

Concluding remarks

thisreportillustratesthattherearesignificantcomplementaritiesofdemandand

competencebetweenNorwayandChinainthefieldofrenewableenergytechnologies

andotherareasofenvironmentalcooperation.thebenefitsofthis,bothfortheeconomy

andtheenvironment,maybefacilitatedthroughappropriatelanguageinafuturefree

tradeagreement.bothgovernmentsalsorecogniseapossiblefutureftAasausefultool

toachievetheircommongoalofsustainabledevelopmentandharmoniousdevelop-

mentofnatureandhumansociety.

5.10 Development Cooperation

thetwosidesrecognisethatundertheframeworkofOfficialdevelopmentAssistance,

ChinaandNorwayhaveenjoyedyearsofproductivecooperation,whichnotonlyhas

madepositivecontributionstoChina’seconomicandsocialdevelopment,butalso

contributedinenhancingthebilateralrelations.Inthiscontext,bothsideswould

furtherexploreandencouragecooperationinthefieldofclimatechange,environment

protectionandotherissuesofcommoninterest.

100

Chapter six: Conclusions and recommendations

ChinaandNorwayhaveasubstantialbilateraleconomicrelationship,whichcouldbe

enhancedandfurtherdevelopedthroughabilateralftA.thisstudydemonstratesthata

bilateralftAencompassinggoods,services,investmentandeconomiccooperation,and

isconsistentwithWtOrules,wouldsupportandreinforcebilateraltradeandinvestment

linkages,andplayanimportantpartinthecloserintegrationofthetwoeconomiesover

thelongterm,andconsequentlydelivertradeandeconomicbenefitstobothcountries.

furthermore,thebilateralftAwouldbetradecreatingfortheworldasawhole,thereby

strengtheningeachcountry’smultilateralandregionaltradepolicyobjectives.

6.1 Key Conclusions

Trade in Goods

thestudyshowsthattariffshindergrowthinbilateraltradebetweenChinaandNorway.

thereexistsscopetofurtherreduceandeliminatetariffs.thestudyexploresthepossi-

bilityoffurtherliberalisationofgoodstradebeyondtheprogressalreadymadeinthe

WtO,andrecommendsthatabilateralftAshouldremovetariffsonindustrialgoods,

andeliminateandreducethetariffsforagriculturalproducts.Whilerecognizingthatthe

removalandreductionsoftariffswouldbenefitthetwocountries,thestudyalsoidenti-

fiesconcernsrelatedtodomesticincome,employmentimpacts,ruralpolicyandfood

securityoftariffeliminationorreductiononcertainsectors,whichshouldbetakeninto

accountinthefutureftAnegotiations.

thestudyalsoidentifiesnon-tariffbarriers(Ntbs)thathavearestrictiveeffectonbilat-

eraltrade.ItwouldbeimportantforChinaandNorwaytoensurethatthesenon-tariff

measuresdonotconstituteunjustifiedbarrierstotrade.Itissuggestedthatnon-tariff

measuresandimproveddisciplinesandenforcementinareassuchastechnicalregula-

tionsandstandards,andsanitaryandphytosanitarymeasures,shouldbeaddressedin

thefutureftAnegotiations.

Trade in Services

theservicesectorisbecominganimportantcomponentoftradebetweenChinaand

Norway,andhasagreatpotentialforgrowthinthefuture.thestudynotesthegener-

allyopennatureofNorway’sservicesregime,andthemajoropeningofChina’sservices

sectorsassociatedwithChina’sWtOaccessionindecember2001,butalsodemonstrates

arangeofimpedimentstothebilateralservicestradebothinspecificindustriesand


acrossthesector.takingthesefactorsintoaccount,thestudyrecommendsthatChina

andNorwayshouldstrengthencooperationandpromotebilateraltradeinservices

underthefutureftAforthebenefitofbothcountries.

Investment

theinvestmentflowsbetweenChinaandNorwayareatpresentrelativelymodest

comparedtobilateraltrade,butthebilateralinvestmentlinkagesaregrowingatahigh

speed.thestudyidentifiesarangeofwaysthatcouldfurtherfacilitateincreasedlevels

ofinvestmentbetweenChinaandNorway.Itisrecommendedthatbuildingonexisting

cooperation,anftAshouldfurtherpromotebilateralinvestment.

Other areas of Cooperation

thestudyalsoidentifiesthefollowingsector-specificissuesandbroaderareasand

opportunitiesforfacilitationandcooperationwiththeobjectivesofstrengtheningbilat-

erallinkagesthroughanftA:tradefacilitation,e-commerce,sanitaryandphytosanitary

measures(sps),technicalregulationsandstandards(tbt),intellectualpropertyrights

(Ipr)smecooperation,temporarymovementofnaturalpersons,tradeandinvestment

promotion,environmentandtechnologycooperationanddevelopmentcooperation.

thestudyrecommendsthatbuildingonexistingcooperationintheaboveareas,anftA

wouldbeexpectedtointensifyfurtherbilateraltradeandeconomiccooperationwith

aviewtoachievemutualbenefits.

6.2 Recommendations

thisstudyhasdemonstratedthatsignificantcomplementaritiesexistbetweenthe

ChineseandNorwegianeconomiesandthataftAwouldbenefitthepeopleandecono-

miesofbothcountries.tosecurethesebenefitsandbuildonthelongandwarmrela-

tionshipsbetweenthetwocountries,thisstudyrecommendsthatnegotiationsona

ftAbetweenChinaandNorwayshouldcommenceassoonaspossible.

Published by:Norwegian Ministry of Trade and Industry Additional copies may be ordered from:Government Administration ServicesPost og distribusjonE-mail: [email protected]: + 47 22 24 27 86 Publication number: K-0702 EDesign: Lysvold DesignPrinted by: Government Administration Services – 03/2008 – Impression 200

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