WASHINGTON-The Clinton administration last week warned that failure by Congress to support renewal of normal trade relations with China could kill negotiations on China’s entry into the World Trade Organization, a prospect that likely would doom landmark wireless trade concessions made by Chinese Premier Zhu Rongji here in April.
That is the message Richard Fisher, deputy U.S. trade representative, and Stanley Roth, State Department assistant secretary of East Asian and Pacific affairs, brought to Capitol Hill last week.
“We have come very close to completion of a WTO accession agreement with China that would dramatically open Chinese markets to American goods, services and agricultural products. Revoking NTR would be certain to end these talks,” Fisher said in written testimony delivered to the House Ways and Means trade subcommittee last Tuesday.
NTR, or normal trade relations, formerly was called most favored nation, or MFN, trade status. The United States has normal trade relations with most countries around the world.
Fisher said U.S. consumers would be hurt by non-renewal of China NTR because goods imported from China would cost 44 percent more. He added that cooperation on trade and other matters with other Asian nations and countries in other regions would suffer if Congress does not back President Clinton’s June 3 decision to renew China NTR.
Many observers believe China WTO membership is dead for this year.
The wireless industry is watching the Chinese NTR debate carefully since its outcome could determine whether service providers and manufacturers can compete anytime soon for billions of dollars in contracts in an Asian nation of 1.2 billion people that lacks modern telecom infrastructure.
For now, U.S.-Sino relations are on shaky grounds. China is still fuming over the NATO bombing of the Chinese embassy in Belgrade, a mishap that killed three Chinese journalists and an occurrence the U.S. insists was due to bad military intelligence.
But U.S. lawmakers are not necessarily in a hurry to do business with China. A bipartisan select House panel recently determined Chinese nuclear capability could be enhanced by U.S. satellite technology transfers and stolen nuclear secrets.
Other flash points with China include a $60 billion trade deficit, human rights and Taiwan.
“While that creates certainly some political tensions between the two countries, I believe that the United States and China still need to find common ground on those issues on which agreement is possible and WTO is one such issue,” U.S. Trade Representative Charlene Barshefsky told The Hill in an interview published last week.
With the 2000 elections drawing nearer, the U.S.-China trade controversy has the ability to draw together far-right isolationists in the GOP and leftist protectionists in the Democratic Party.
“Punishment of the Chinese for their activities by disengaging, or denying NTR status, would come at a very high policy cost to the U.S.,” Roth warned lawmakers.
For the United States, thawing out the big chill in U.S.-Sino relations is a fragile political process. The Clinton administration reportedly is scrambling to decide who will lead a delegation to China to report on the embassy bombing and to get trade talks back on track. The decision apparently is a tricky one since the White House wants to send someone of stature to signal U.S. seriousness and sincerity. But that person has to be liked by the Chinese government. Not all likely candidates for the trip, slated for this past weekend, fit the bill.
Thomas Pickering, undersecretary of State for political affairs and a former ambassador to Russia, India and the United Nations, appears to be the administration’s choice to head the U.S. delegation.
