DATE=4/15/99
TYPE=BACKGROUND REPORT
NUMBER=5-43122
TITLE=U-S / CHINA / WTO
BYLINE=STEPHANIE MANN
DATELINE=WASHINGTON
CONTENT=
VOICED AT:
INTRO: CHINESE PREMIER ZHU RONGJI WILL RETURN HOME (THE MIDDLE
OF NEXT WEEK) AFTER HIS NORTH AMERICAN TRIP WITHOUT SOLID U-S
ENDORSEMENT FOR CHINA'S ENTRY INTO THE WORLD TRADE ORGANIZATION.
A TRADE DEAL DESIGNED TO SECURE THE NECESSARY U-S APPROVAL SEEMED
ALL WRAPPED UP BUT THEN BEGAN TO UNRAVEL DURING HIS VISIT TO
WASHINGTON. V-O-A'S STEPHANIE MANN REPORTS ON WHAT HAPPENED TO
THE DEAL THAT WAS NEGOTIATED AND WHY IT NEEDS MORE WORK.
TEXT: THE UNITED STATES AND CHINA HAVE BEEN NEGOTIATING THE
TERMS FOR CHINA'S ACCESSION TO THE WORLD TRADE ORGANIZATION FOR
13 YEARS. CHINA HAS WANTED TO GAIN ENTRY AS A DEVELOPING
COUNTRY, RATHER THAN AS A DEVELOPED COUNTRY, SO IT CAN BENEFIT
FROM MORE LENIENT W-T-O REQUIREMENTS, IN PARTICULAR REGARDING
IMPORT RESTRICTIONS.
HOWEVER, BECAUSE OF THE SIZE OF CHINA'S ECONOMY AND ITS VOLUME OF
INTERNATIONAL TRADE, THE UNITED STATES AND MANY OTHER W-T-O
MEMBERS BELIEVE CHINA SHOULD UNDERTAKE ECONOMIC REFORMS SO IT CAN
COMPLY WITH BROADER W-T-O REQUIREMENTS THAT THE DEVELOPED
COUNTRIES MUST MEET. CHINA HAS SAID IT IS MAKING THE REFORMS,
WHICH WOULD INCLUDE OPENING ITS MARKETS, BUT THEY WILL TAKE
SEVERAL YEARS.
IN THE WEEKS LEADING UP TO PREMIER ZHU'S VISIT TO WASHINGTON, THE
TRADE NEGOTIATIONS INTENSIFIED, WITH THE TOP U-S NEGOTIATOR,
TRADE REPRESENTATIVE CHARLENE BARSHEFSKY, MAKING SEVERAL TRIPS TO
BEIJING. MANY ANALYSTS SAY THE DEAL COULD HAVE BEEN FINALIZED
DURING PREMIER ZHU'S VISIT. BUT THEY SAY THE U-S SIDE TOOK STEPS
TO DELAY IT.
THE DIRECTOR OF THE CHINA POLICY PROGRAM AT GEORGE WASHINGTON
UNIVERSITY, DAVID SHAMBAUGH, SAYS WHEN PREMIER ZHU ARRIVED IN THE
UNITED STATES APRIL 6TH, THE PRESIDENT'S ADVISORS TOLD MR.
CLINTON A DEAL WAS READY.
// SHAMBAUGH ACT ONE //
HIS ADVISORS, WHICH INCLUDE REPRESENTATIVE BARSHEFSKY,
SECRETARY OF STATE (MADELEINE) ALBRIGHT, NATIONAL
SECURITY ADVISOR (SANDY) BERGER AND OTHER NATIONAL
SECURITY COUNCIL STAFF MEMBERS AND OTHERS ALL URGED THE
PRESIDENT THAT THIS WAS INDEED THE BEST DEAL THAT WE
COULD HOPE TO GET FROM CHINA. INDEED IT WAS A MUCH
BETTER DEAL THAN MANY, VIRTUALLY ALL, ANALYSTS EXPECTED.
THE CHINESE WENT VERY FAR IN MANY, MANY CATEGORIES TO
MEET AMERICAN CONCERNS AND INDEED W-T-O ACCESSION
STANDARDS.
// END ACT //
AMONG THE CONCESSIONS OFFERED BY CHINA WERE SIGNIFICANT CUTS IN
TARIFFS FOR IMPORTS OF AGRICULTURAL AND INDUSTRIAL PRODUCTS, A
DECISION TO ALLOW U-S TELECOMMUNICATION COMPANIES TO HOLD A LARGE
SHARE OF THE CHINESE TELECOMMUNICATIONS MARKET, A RELAXATION OF
THE LIMITS ON THE OPERATION OF U-S INSURANCE COMPANIES IN CHINA,
AND A PARTIAL OPENING OF THE CHINESE FINANCIAL SERVICES SECTOR TO
U-S BANKS.
BUT PROFESSOR SHAMBAUGH (WHO IS ALSO A SENIOR FELLOW AT THE
BROOKINGS INSTITUTION, A WASHINGTON RESEARCH ORGANIZATION) SAYS
THE PRESIDENT, AT THE LAST MINUTE, CHOSE NOT TO ACCEPT THE
RECOMMENDATION OF HIS TOP FOREIGN POLICY ADVISORS.
// SHAMBAUGH ACT 2 //
I WOULD NOT SAY IT WAS THE CLINTON ADMINISTRATION THAT
DID NOT CLOSE THE DEAL. IT WAS THE PRESIDENT WHO DID
NOT CLOSE THE DEAL. AND HE DIDN'T DO SO FOR FEAR OF THE
AMERICAN TEXTILE LOBBY AND INDEED BECAUSE OF THE
GENERALLY SOUR ATMOSPHERE ON CAPITOL HILL CONCERNING
CHINA THESE DAYS.
// END ACT //
WHAT THE PRESIDENT DID, PROFESSOR SHAMBAUGH SAYS, WAS INTRODUCE
NEW CONDITIONS AFTER PREMIER ZHU'S ARRIVAL.
POLITICAL ECONOMIST TOM GALLAGHER SAYS THE WHITE HOUSE, FOR
DOMESTIC POLITICAL REASONS, ADDED ISSUES TO THE NEGOTIATIONS THAT
HAD BEEN A SOURCE OF DISAGREEMENT BUT HAD NOT BEEN DISCUSSED
PREVIOUSLY AS A PRECONDITION FOR U-S APPROVAL OF CHINA'S W-T-O
MEMBERSHIP.
// GALLAGHER ACT ONE //
THE ONE AREA THAT THE WHITE HOUSE POINTED TO AS AN AREA
WHERE THEY WANTED FURTHER CONCESSIONS FROM CHINA HAS
NOTHING REALLY TO DO WITH W-T-O MEMBERSHIP. IT HAS TO
DO WITH PROTECTING THE U-S TEXTILE AND APPAREL MARKETS
FROM A SURGE IN CHINESE IMPORTS. ... A LOT OF PEOPLE
THINK THAT WAS PUT IN AT THE LAST MINUTE IN ORDER TO
PREVENT A DEAL FROM BEING FINALIZED. THAT'S BECAUSE THE
WHITE HOUSE, FOR ONE OR TWO POLITICAL REASONS, JUST
DIDN'T WANT TO RAISE THE ISSUE OF IMPROVED ECONOMIC
RELATIONS WITH CHINA AT THIS MOMENT.
// END ACT //
MR. GALLAGHER IS SENIOR MANAGING DIRECTOR AT INTERNATIONAL
STRATEGY AND INVESTMENT GROUP -- A NEW YORK-BASED BROKERAGE FIRM
THAT SPECIALIZES IN ECONOMIC RESEARCH. HE SAYS THE POLITICAL
REASONS BEHIND PRESIDENT CLINTON'S DECISION INCLUDE A FEAR OF
FURTHER ANTAGONIZING MEMBERS OF CONGRESS -- MANY OF THEM ALREADY
UPSET OVER ALLEGATIONS OF CHINESE SPYING AT U-S NUCLEAR
LABORATORIES AND ALLEGATIONS THAT CHINA FUNNELED MONEY TO U-S
ELECTION CAMPAIGNS.
IN ADDITION, MR. GALLAGHER SAYS, AMERICAN LABOR UNIONS ARE
OPPOSED TO FAVORABLE TRADE TREATMENT FOR CHINA AND THEY PUT
POLITICAL PRESSURE ON THE PRESIDENT.
THEA LEE IS ASSISTANT DIRECTOR OF PUBLIC POLICY AT THE AFL-CIO --
A LARGE AMERICAN TRADE UNION FEDERATION. SHE SAYS THE AFL-CIO
DOES NOT OPPOSE THE EVENTUAL ADMISSION OF CHINA INTO THE W-T-O,
BUT SHE SAYS IT FIRST MUST IMPROVE ITS HUMAN RIGHTS AND LABOR
RIGHTS, SUCH AS ALLOWING WORKERS FREEDOM TO ORGANIZE AND CONDUCT
COLLECTIVE BARGAINING. MOREOVER, MS. LEE SAYS CHINA HAS NOT YET
PROVEN THAT IT WOULD CARRY OUT ALL THE TRADE CONCESSIONS IS HAS
PROMISED IN ORDER TO JOIN W-T-O.
// BEGIN OPT // // LEE ACT ONE //
OUR EXPERIENCE TO DATE IS THAT CHINA HAS NOT ABIDED BY
EITHER THE SPIRIT OR THE LETTER OF THE BILATERAL TRADE
AGREEMENTS THAT WE HAVE SIGNED WITH THE CHINESE
GOVERNMENT. AND SO, I GUESS THAT RAISES A LOT OF
SKEPTICISM FOR US ABOUT WHETHER CHINA IS WILLING OR ABLE
TO DRAMATICALLY CHANGE ITS ECONOMIC POLICIES TO CUT ITS
TARIFFS, TO AFFORD U-S COMPANIES ACCESS TO CHINESE
MARKETS AS HAS BEEN DISCUSSED UNDER THE NEGOTIATIONS FOR
THE W-T-O ACCESSION.
// END ACT //
// OPT // MS. LEE SAYS AMERICAN LABOR IS ALSO WORRIED ABOUT THE
POSSIBLE LOSS OF AMERICAN JOBS. SHE SAYS U-S COMPANIES -- ONCE
THEY GAIN GREATER ACCESS TO CHINA'S MARKETS -- MAY DECIDE TO MOVE
THEIR PRODUCTION LINES TO CHINA INSTEAD OF CONTINUING TO PRODUCE
GOODS IN THE UNITED STATES FOR EXPORT TO CHINA.
// OPT // HOWEVER, TOM GALLAGHER SAYS W-T-O MEMBERSHIP FOR CHINA
WOULD BENEFIT THE UNITED STATES.
// OPT // GALLAGHER ACT 2 //
CERTAINLY U-S EXPORTERS ARE HELPED BY REDUCTION OF TRADE
BARRIERS. U-S MULTINATIONALS BENEFIT FROM MORE FREEDOM
OF ACTION WITHIN THE CHINESE MARKET. AND THIS IS A
CONTROVERSIAL POINT, BUT I THINK AT A POLITICAL LEVEL,
IT HELPS FOR THE U-S TO BE ABLE TO GO TO THE W-T-O WHEN
IT HAS COMPLAINTS ABOUT CHINESE TRADE PRACTICES INSTEAD
OF GOING HEAD TO HEAD AND TRYING TO FORCE THE CHINESE TO
BACK DOWN ON A BILATERAL BASIS.
// END ACT // END OPT //
DURING THE CHINESE PREMIER'S VISIT TO WASHINGTON WHAT THE TWO
SIDES SIGNED -- INSTEAD OF A WIDE-RANGING TRADE DEAL -- WAS AN
AGREEMENT THAT REDUCES TARIFFS AND OTHER CHINESE BARRIERS TO
IMPORTS OF U-S WHEAT, CITRUS AND BEEF PRODUCTS.
BOTH GOVERNMENTS SAY THEY ARE COMMITTED TO GAINING CHINA'S
ACCESSION TO W-T-O THIS YEAR, AND BOTH SAY THE NEGOTIATIONS ARE
ALMOST COMPLETE. PRESIDENT CLINTON TELEPHONED PREMIER ZHU WHEN
HE WAS VISITING NEW YORK AND ASKED THE CHINESE LEADER IF HE
AGREED TO REVIVING THE TRADE TALKS SOON. THEY AGREED TO DO SO,
AND U-S TRADE REPRESENTATIVE BARSHEFSKY IS EXPECTED TO GO TO
BEIJING LATER THIS MONTH FOR TALKS ON THE OUTSTANDING ISSUES.
HOWEVER, IT REMAINS TO BE SEEN IF CHINA WILL STILL OFFER THE FULL
LIST OF CONCESSIONS IT DID EARLIER THIS MONTH AND WHETHER THE U-S
SIDE WILL CONTINUE TO PRESS FOR NEW CONCESSIONS TO PROTECT THE
AMERICAN TEXTILE INDUSTRY AND DEAL WITH IMPORT SURGES. (SIGNED)
NEB/SMN/KL
15-Apr-99 12:54 PM EDT (1654 UTC)
NNNN
Source: Voice of America
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