World Trade Organization (wto)

Analysis of business environment

Political environment:

During the past ten years, the Chinese government joined World Trade Organization (WTO) to opened markets to world investors. This philosophy change is aimed at encouraging more foreign investment in China. What’s more, nowadays, the Chinese government system has remained stable. Moreover, it is taking measures to enforce a more strict legal system to support free commerce between domestic and global market((Bonnie Handy, 2003). Australia has a strong Trade relationship with China. Further deepening and strengthening the relationship has become a primary task for them. What’s more, during the past twenty years, both of the two countries are committed keep the perfect trade performance. As a result, Australia has become the largest two-way trading partner. On 18 April 2005, both of two governments agreed to negotiations on Free Trade Agreement (FTA), with a consideration of a united FTA Feasibility research. Furthermore, since China has joined WTO, many tariffs on import have been lower. The average tariff decreased from 15.3% in 2000 to 9.8 in 2009((Trades, 2014). Also the recognized internationally National Association for Sustainable Agriculture Australia Limited (NASSA) has recently signed an agreement with a Chinese certifier to provide Australian customers with a more time- and cost-effective package for Chinese organic food certificate application (Australiagoverment, 2014). Hence, the policy environment of China is good for Organic beef as lower cost and more open market.

Economic environment

GDP: US$9.181 trillion (2013)

GDP per capita: US$6,747 (2013)

GDP growth: 7.7 per cent (2013)

Population: 1,360.8 million (2013)

Trade with Australia: AUD$150.9 billion (2013) ((Trades, 2014)

Due to the figure above, it can be seen that the economy in China is growing fast. China is always the primary target of world destination of FDI, and become more competitive in the global market since joined WTO. What’s more, with the rapid growth of economy, the life level of Chinese is improved as well. At the same time, China manipulated hold currency at a low level. In 2008, the currency appreciated 21% against US dollars. However, the appreciated RMB would be a win-win situation in the terms of world economy. Even Obama government is willing to strengthen global monetary Fund to improve currency practices((Fogel, 2010). According to the Dutch bank Rabobank analysis report, China has imported 297,000 tons of beef, which is 3.79 times than in 2012. Addition, on 25 April 2014,Rabobank has published a new report that by China’s government will increase beef imports as a result from supporting the