With Concerns of Unrest, China Puts Brakes on WTO ; Parliament Ended Its Session Yesterday, and a More Cautious Leadership Emerges

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At midday a fragrant dumpling soup sells briskly as a neatly dressed man toes the sidewalk in this working class neighborhood of Beijing. Liu Songmei is an unemployed farmer from Hunan province, here to find work as a carpenter.

Mr. Liu, one of as many as 150 million out-of-work farmers in China, finds a job about "every other week," he says, "but nothing today." He makes 60 yuan a day ($7.25), and spends half of that on a room shared with several others. "We have enough to eat, but we aren't saving anything," he says.

After a strong '90s-era push by China's top echelon of reformers to insert this huge but developing country into the fast lane of the world's economy, including World Trade Organization membership this year, a quiet but significant shift toward caution is under way, with a wing of Communist Party brass reportedly worried about the potential social pressures that wrenching and wholesale structural changes to China's economy may bring.

China's WTO membership, for example, agreed to by the US Congress last fall amid fanfare, may not take place this year, analysts say.

Yesterday, China's biggest annual political event, the National People's Congress - 10 days of giant red flags fluttering in the stiff March breezes, and Beijing streets choked with black limousines - came to an end.

On the surface of the meeting, all appeared tranquil and even uneventful. A new "Five Year Plan" for the economy was unveiled to 2,900 officials from the provinces. Business and trade on the wealthy east coast and in Hong Kong remain dynamic. The nation's growth rate has leveled off but is strong at about 7 percent, officials say.

Yet small signals under the surface suggest worry over the mindsets of ordinary Chinese. There are, for example, restless peasant and working classes - of which the recent crackdown on the outlawed Falun Gong movement is part of the story. In the next five years, economic ministers say, between 40-to-50 million of 800 million farmers will be laid off each year, as the country moves to modern farming techniques. China signed off on a WTO agreement that requires it to meet developed world standards on crucial farm subsidies, but Chinese officials and many Western agriculture experts now argue this standard must be eased: The developing- country subsidy of 10 percent of output is about double that of the developed-country standard.

There are concerns over laid- off workers from the industrial sector, the fallout from a transition away from state-run enterprises. In a press conference March 10, a high ranking minister hinted that about 52 million industrial workers will lose jobs over the next five years. Already, 10 million are officially redundant, though the exact figure is hard to reckon. China has some 145 million registered industrial workers. The government classifies many of the laid-off as not employed but looking, and not counted as jobless.

Authorities take as progress what they say is a slow but steady public adjustment to a new economy. "Today, people can accept

that state-owned enterprises can go bankrupt," said State Economic Trade minister Li Rongrong March 10. "Three years ago people could never accept this."

Yet in a one-party state that next year begins a transition to newly appointed leaders, including premier and president, some officials are concerned about leaping into the unknown - even while continuing to integrate into world markets.

"They are worried about instability, and they should be," says a Western scholar working in Beijing with the unemployed. …