allocation of investment assumes that the shares of domestic and foreign investments are held constant, subject to the adding-up constraints required to ensure regional saving and investment constraints. Explicit modeling of the ownership of regional investment allows us to track the accumulation of wealth by foreigners, thereby ascertaining how China's accession to the WTO might affect foreign investment and ownership in each region. Moreover, the income accruing from the foreign and domestic ownership of assets can then be appropriately incorporated into regional income, and hence into the calculation of welfare, for both China and all other regions.

**Table 1. China's Average Tariff Rates** (%)

|**Sectors**|**1997**|**1998**|**1999**|**2000**|**2001**|**2002**|**2003**|**2004**|**2005**|**2006**|**2007-**<br>**2010**|
|---|---|---|---|---|---|---|---|---|---|---|---|
|**Foodgrains**|10.6|9.8|9.1|8.3|7.6|7.6|7.6|7.6|7.6|7.6|7.6|
|**Feedgrains**|28.0|29.0|30.0|31.0|32.0|32.0|32.0|32.0|32.0|32.0|32.0|
|Vegetables-fruits-nuts|-8.0|-7.0|-6.0|-5.0|-4.0|-4.0|-4.0|-4.0|-4.0|-4.0|-4.0|
|Oilseeds|28.0|26.0|24.0|22.0|20.0|17.2|14.3|11.5|8.7|5.8|3.0|
|**Sugar**|42.0|41.5|41.0|40.5|40.0|36.7|33.3|30.0|26.7|23.3|20.0|
|Plantfibers|17.0|17.0|17.0|17.0|17.0|17.5|18.0|18.5|19.0|19.5|20.0|
|Livestock-Meat-Dairy|-8.9|-8.2|-7.4|-6.7|-5.9|-6.3|-6.6|-6.9|-7.2|-7.5|-7.8|
|Beverages-tobacco|63.2|58.9|54.5|50.2|44.6|39.9|35.1|30.3|25.5|20.8|16.0|
|**Otherfood**|34.8|35.2|35.5|35.9|35.3|31.0|26.7|22.4|18.1|13.8|9.5|
|**Woodproducts**|10.8|10.5|10.2|9.8|9.5|8.5|7.5|6.5|5.5|4.6|3.6|
|Extract|0.2|0.3|0.3|0.3|0.5|_0.5_|0.4|0.4|0.4|0.3|0.3|
|Textiles|25.1|24.2|23.3|22.4|20.7|18.8|16.8|14.8|12.8|10.8|8.8|
|**Wearing apparel**|31.8|30.0|28.2|26.4|23.4|22.0|20.7|19.3|18.0|16.6|15.3|
|**Lightmanufactures**|12.1|12.1|12.1|12.2|11.7|11.1|10.5|9.8|9.2|8.6|8.0|
|**Processingindustries**|12.0|12.0|12.0|12.0|11.7|10.9|10.1|9.2|8.4|7.6|6.8|
|Autos|34.4|34.9|35.4|35.8|32.0|29.0|26.0|23.0|20.0|17.0|14.0|
|**Electronics**|11.9|11.5|11.0|10.6|10.3|9.0|7.6|6.2|4.8|3.4|2.0|
|**Othermanufactures**|13.2|13.2|13.2|13.2|12.9|11.9|10.8|9.8|8.7|7.7|6.7|

Source: Authors's calculations based on version 5 GTAP data (www.gtap.or ), World Bank, and data from CDS consulting. These tariff rates are trade weighted, applied, statutory rates..

We use version 5 GTAP database, aggregated into 20-regions and 22-sectors, shown in Appendix Table Al. The GTAP data base is supplemented with foreign income data from the IMF Balance of Payments statistics in order to track international capital mobility and foreign wealth.

We assesses the regional impact of China's WTO accession against a baseline that depicts the growth of the world economy over the period 1997-2010,37 the implementation of the Uruguay Round (UR), the Agreement on Textiles and Clothing, AFTA, and the reform in China prior to 2001. The accession scenario represents reform of China's agriculture, manufacturing and services. Reform in agriculture includes tariff

> the number of regions). The use of the global trust minimizes the data required to regional saving invested abroad and total foreign investment in each region (2n data values).

> 37 Appendix Tables A2 and A3 show baseline growth rates for GDP and gross domestic investment (GDI).

10