ABSTRACT
The complicated and seemingly irreconcilable relationship between trade and environment has attracted significant attention in China after its entry into the World Trade Organization (WTO). WTO accession is expected to help China achieve a number of objectives, the most important of which are to secure more predictable market access for its exports to the rest of the world and to attract more foreign investment. Pollution problems may all be worsened following China's WTO accession. Whether trade liberalization worsens environmental pollution in a static sense depends on whether the liberalizing country has a comparative advantage in "dirty" industries. The enactment of the Environmental Impact Assessment (EIA) Law was a landmark in the progress of China's EIA regime. China's export trade is especially affected by the mandatory environmental standards, eco-labeling, and packaging requirements of importing countries. The state may also restrict or prohibit exports where there is a domestic shortage in supply or in order to protect exhaustible natural resources.
