29 March 1999
TEXT: DALEY 3/29 REMARKS ON U.S. ENGAGEMENT WITH CHINA
(Daley says China must address issues that concern U.S.) (800) Beijing -- The United States must follow a "realistic, clear-eyed strategy of comprehensive engagement with the Chinese," according to U.S. Commerce Secretary William Daley. While issues such as the fast-growing trade deficit with China, human rights abuses, and allegations of espionage at nuclear laboratories may cloud relations between the two countries, Daley stressed that engagement "is the only workable course." At the start of this year, Daley noted in March 29 remarks in Beijing, U.S. exports to China fell to their lowest level in more than two years. "With a $1 billion-a-week trade deficit," Daley said, "it's critical to get more of our products in the mainstream of China's economy." Calling on the Chinese to recognize the importance of addressing "serious differences on critical issues which have cast a shadow on our relationship," Daley added it would not serve U.S. interests to use any one issue, whether the trade deficit, "the illicit transfer of technology," or human rights as "a referendum on our overall relations with China." "As we move into our third decade of normalized relations with China," Daley said, "a realistic, clear-eyed strategy of comprehensive engagement with the Chinese on all our interests is the only workable course." Following is the text of Daley's remarks from the Department of Commerce: (begin text) Prepared Remarks of Secretary William Daley for Press Briefing Monday, March 29, 1999 4:45-5:30 p.m. Beijing, China The first day of my visit here to Beijing has been a very productive one. I had the opportunity to conduct constructive meetings with key Chinese government officials -- Premier Zhu Rongji and State Councilor Wu Yi. Throughout these meetings, I highlighted the many areas where our two countries have found common ground and worked cooperatively together, including discussing some of the very projects many of the companies represented on this mission are participating in. My most fundamental and critical message to both of these leaders was growing our exports. For the first month of this year, our exports to China fell to their lowest level in more than two years. With a $1 billion a week trade deficit, it's critical to get more of our products in the mainstream of China's economy. I also emphasized the importance of addressing serious differences on critical issues which have cast a shadow on our relationship, most recently illicit transfer of technology, and human rights. Using this issue, however, or any other as a referendum on our overall relations with China doesn't serve our interest. As we move into our third decade of normalized relations with China, a realistic, clear-eyed strategy of comprehensive engagement with the Chinese on all our interests is the only workable course. I am pleased to say that, despite difficult times, China's leaders continue to support the blueprint for comprehensive engagement laid out by Presidents Clinton and Jiang over the past two years. These Summits yielded important initiatives, including the infrastructure mission I am leading and other initiatives. To make progress on this objective, I have sought broader long-term involvement of U.S. firms in China's infrastructure development. I noted to Premier Zhu and others that we took great interest in remarks that he made during the National People's Congress regarding the challenges China faces in developing its infrastructure further and in relying on that, in part, to generate economic growth. Premier Zhu has noted that shoddy construction, corruption, and other factors have retarded economic growth here. U.S. firms have proven know-how and expertise which can make a significant and positive contribution here. I am pleased to have witnessed today, along with China's State Counselor Wu Yi, the signing of several agreements between U.S. firms and Chinese partners. Each of these agreements demonstrates the positive impact that U.S. technology, expertise, and world class equipment will have on the development of China's infrastructure and overall economy. I also, however, realize that China's plans to invest in infrastructure are not a panacea for resolving our concern on market access. On the contrary, many policies are a step backward, such as import substitution and localized policies in sectors of great interest to us -- telecommunications, pharmaceuticals, power generation, and others. I am emphasizing to Chinese officials that, in pursuit of developing its infrastructure, China needs to embrace greater market openness as it intensifies economic reforms. Markets need to be open to the forces of global competition in order to benefit. I made clear that allowing protectionism to flourish betrays China's overall goal of greater and sustained economic growth at a time when growing the economy is critical. I would be happy to take your questions. (end text)
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