SOVIET UNION SEEN WATCHING CHINA GATT APPLICATION

  China's application to join the General
  Agreement on Tariffs and Trade (GATT) is seen as a test case by
  the Soviet Union, which will probably demand to follow China, a
  top European Community official said.
      Willy de Clercq, External Relations Commissioner of the
  European Communities, told a news conference that China's
  application would involve long and difficult negotiations.
      China formally applied to join GATT in July 1986 and in
  February presented a memorandum backing its application, which
  De Clercq said was now being studied. Questions would then be
  presented to China.
      "After China, other important state-trading countries
  including the Soviet Union, will probably demand accession.
  China's application could be considered a test case," he said.
      He said the EC strongly backed China's application, but
  others among GATT's 92 contracting parties took a tougher line.
      Among the numerous problems of a huge centrally-run economy
  entering a free trade system are tariffs and reciprocity and
  the expectation that China will practice an open-trade policy
  without trade discrimination, de Clercq added.
      De Clercq noted the different dimensions of the Chinese
  economy and those of Hungary and Yugoslavia, the two current
  Socialist GATT members.
      On China's import potential, he said a foreign exchange
  shortage would force China to import less this year and next
  than in the past, with an emphasis on technological equipment
  and capital.
      During his visit, De Clercq has met top Chinese leaders and
  today signed an agreement to open a European Community
  Commission office in Peking.
  

