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USIS Washington File

23 March 2000

Text: Senator Roth Statement on Implications of U.S.-China Trade

(Finance Committee chair introduces bill to give China PNTR) (1160)
Senate Finance Committee Chairman William V. Roth, Jr. opened a
committee hearing on the implications of trade with China for U.S.
national interests by announcing that he and another senator had
introduced legislation to grant permanent Normal Trade Relations
(PNTR) for China in anticipation of that country's entry into the
World Trade Organization (WTO).
According to a press release issued March 23, the Delaware Republican
said he supported PNTR for China partly because "the fact that Taiwan
supports China's global economic integration and [China's] hardliners
and the [Chinese military] adamantly oppose it, in my view, only makes
support for China's accession to the WTO and passage of PNTR
legislation more important."
He said the passage of PNTR will simply remove China from the
limitations of the United States' Jackson-Vanik amendment, which links
U.S. trade relations to the requirement that the citizens of a foreign
country enjoy freedom of emigration.
However, if PNTR legislation were not passed, Roth warned that "the
losers will be American firms and American workers who will be denied
the opportunity to compete on a level-playing field with their
British, French, German, and Japanese competitors."
"The losers will also include Chinese workers who will have no
alternative but to work for state-owned Chinese firms that would deny
them basic labor rights, or foreign firms that have in the past proved
significantly less sensitive to labor concerns than have American
firms," he added.
Following is the text of Roth's statement:
(begin text)
ROTH STATEMENT AT HEARING ON TRADE WITH CHINA AND ITS
IMPLICATIONS FOR U.S. NATIONAL INTERESTS
WASHINGTON -- The Senate Finance Committee met today to hear testimony
on trade with China and to consider its implications for U.S. national
interests. Senate Finance Committee Chairman William V. Roth, Jr.
(R-DE) delivered the following opening statement.
"This hearing is the second in a series the Finance Committee will
conduct on China's accession to the World Trade Organization. I wish
to announce that this morning I and Senator Moynihan introduced in the
Senate the legislation the President sent up to Congress that would
enact permanent normal trade relations for China. We will require the
President's continued strong support and an equally strong bipartisan
effort here in Congress to ensure the consideration and movement of
this legislation.
"Before we get started, I think it would be helpful to clarify once
again what the vote on PNTR for China is all about. The vote on PNTR
will not decide whether China gets into the World Trade Organization.
China will accede to the WTO regardless of how Congress votes on PNTR.
"The question before Congress is whether our exporters will gain
access to the Chinese market on the same terms as their competitors
and whether, after 13 years of arduous negotiations to open the
Chinese market and encourage their adherence to a rules-based
international trading system, we will now forego the benefits of that
deal.
"Under the WTO, if we impose conditions on our trading relationship
with China, even in the form of an annual vote, we will not have
granted China the same access to our market as we have other WTO
members. That, in WTO terms, would require us to invoke what is known
as 'non-application,' meaning that we cannot fulfill the terms of our
own WTO obligations with respect to China.
"In that event, China would be entitled to deny our exporters access
to their markets on the terms available to all other WTO members. The
losers will not be the Chinese government. Nor will the losers include
heavily-subsidized state-owned industries in China that are the
principal source of labor problems.
"The losers will be American firms and American workers who will be
denied the opportunity to compete on a level-playing field with their
British, French, German, and Japanese competitors. The losers will
also include Chinese workers who will have no alternative but to work
for state-owned Chinese firms that would deny them basic labor rights,
or foreign firms that have in the past proved significantly less
sensitive to labor concerns than have American firms.
"As a technical matter, the passage of PNTR will simply remove China
from the ambit of the Jackson-Vanik amendment. Our focus today is on
whether removing China from the scope of the Jackson-Vanik's freedom
of emigration requirements has broader implications for U.S. national
interests.
"That issue has been joined by the Administration's delivery of its
PNTR legislation to the Congress in response to the concerns expressed
by this Committee at our hearing last month. The President sent us a
clean bill that simply authorities the removal of China from the scope
of the Jackson-Vanik amendment upon accession to the WTO, provided
that the deal is consistent with the terms agreed to this past
November between the United States and China.
"China's statements since our last hearing, on the other hand, have
continued to be troubling. In the run-up to the presidential election
in Taiwan this past Saturday, the PRC raised its rhetoric to new
levels of hostility. As in Taiwan's last presidential contest in 1996,
the people of Taiwan chose to shrug off the threats from Beijing. And
in another manifestation of the island's democratic maturity, the
people elected a President from the opposition Democratic People's
Party for the first time.
"Lost in the sharp exchange of words has been Taiwan's consistent
support for trade with China and China's accession to the WTO. Just
two days ago, Taiwan's parliament dropped a five-decade-old ban on
direct trade, transport and postal links between two of Taiwan's
offshore islands and mainland China. And President-elect Chen was
quoted in yesterday's L.A. Times as saying, 'We would welcome the
normalization of U.S.-China trade relations, just like we hope the
cross-strait relations [between Taiwan and China] can also be
normalized,' Chen said. 'We look forward to both the People's Republic
of China's and Taiwan's accession to the WTO.'
"I think it's also important to remember that within China it's the
hardliners and the PLA who are most opposed to China joining the WTO.
That's because they are the ones who most fear the forces China's
greater economic openness will unleash.
"The fact that Taiwan supports China's global economic integration and
PRC hardliners and the PLA adamantly oppose it, in my view only makes
support for China's accession to the WTO and passage of PNTR
legislation more important.
"We're fortunate today to have among our witnesses an array of experts
who can address the impact of granting PNTR to China and that
country's accession to the WTO on U.S. economic, political, military
interests, and on other matters central to U.S. concerns such as labor
conditions, human rights and religious freedom."
(end text)
(Distributed by the Office of International Information Programs, U.S.
Department of State - www.usinfo.state.gov)



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