Intelligence

DATE=07/20/01

TYPE=CORRESPONDENT REPORT

TITLE=CHINA/U-S/SPY PLANE (L-ONLY)

NUMBER=2-278447

BYLINE=KIRK TROY

DATELINE=BEIJING

CONTENT=

VOICED AT:

INTRO: China has criticized the U-S Congress for rejecting its compensation claim for services provided after an American spy plane made an emergency landing in southern China in April. As Kirk Troy reports from Beijing, China says the move will hinder improvement in Sino-U-S relations, strained, in part, because of the spy plane incident.

TEXT: China's Foreign Ministry says it resolutely opposes efforts by the U-S Congress to prevent the payment of one-million dollars that Beijing claims it is owed for the costs of providing services to a U-S spy plane and its crew, after an emergency landing on Hainan island in April.

The U-S House of Representatives voted Wednesday to bar compensation to China.

Beijing blames a few anti-China members of the U-S Congress, and says the House vote is an attempt to hinder the mending of relations, which were badly damaged by the spy plane incident.

Relations between the two countries soured after the U-S reconnaissance plane collided with a Chinese fighter over the South China Sea and made an emergency landing in Chinese territory April 1st. China detained the 24 U-S crew members for 12 days, and refused to allow the plane to be repaired and flown out. The U-S plane was dismantled and shipped back to the United States early this month.

China has delivered a hefty bill, which it claims is for services and lodging for the U-S air crew.

Washington has called the figure demanded by the Chinese government excessive.

Some analysts say, while China is annoyed, it should not be surprised by the U-S reaction to the claim.

Allen Choate of the Asia Foundations in Hong Kong:

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The Chinese reaction was probably inevitable, rather predictable. . What is surprising to me is that they didn't see this coming. When the bill was handed in . the American reaction at that time went from disbelief to anger. And certainly, Beijing must have known that bill was not happily received at all.

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The U-S Defense Department says it is considering the Chinese financial claim and will pay what it called a fair and appropriate amount. (Signed)

NEB/HK/KT/HB/JO/TW