White House Steps Up Campaign for China Trade Status

The Clinton administration has stepped up its campaign in recent days to win an uphill battle with Congress for supporting China's accession to the World Trade Organization (WTO) and granting it a Permanent Normal Trade Relations (PNTR) status.

"The United States would gain unprecedented access to China's markets" in return for China's entry as a full partner in the WTO,U.S. President Bill Clinton told more than 1,000 high-tech workers at a meeting sponsored by UUNET, a subsidiary of MCIWorldCom, on Wednesday in Ashburn, Virginia.

He said that any president in this country, regardless of party, would welcome changes resulting from China's entry into the WTO, "because presidents, regardless of party, have worked to bring about these changes for more than 30 years now."

When joining the WTO, China's tariffs on information technology, which at present averages 13 percent, will start to fall and be eliminated by 2005, and this will allow China's Internet and telecom markets open to American investment and services for the first time, Clinton said. "That's a huge deal," he noted.

Statistics show that China's information technology equipment market is estimated to be rising by 20-40 percent annually, and between 1990 and 1998, U.S. high technology industry exports to China have increased over five times and its exports of communications equipment grown over nine times.

Internet users in China quadrupled in 1999, jumping from 2 million at the beginning of the year to 9 million, and are expected to grow to 20 million by the end of 2000. Some analysts predict that China will become the world's second largest personal computer market by the end of this year and the third largest semiconductor market by 2001.

China, where there were 40 million cellular subscribers by the end of 1999, also represents the fastest growing telecommunications market in the world, but only 5 percent of this market has been tapped up to now.

"If we turn our backs on this opportunity, we will be unilaterally disarming in perhaps the most vital area of our future economic growth," Clinton said.

Meanwhile, U.S. Secretary of State Madeleine Albright reiterated the importance of China's entry into the WTO, and called for a delinkage between the PNTR and the Taiwan issue.

"We think that the WTO deal that was negotiated very painstakingly is good for U.S. exports and for our workers and for farm interests," Albright said at a hearing of the Commerce, Justice, State, and Judiciary Subcommittee of the Senate Appropriations Committee on Thursday.

She billed China's WTO accession as "something that works in our favor and is worth doing for the national and economic interests."

"For economic reasons we delieve that permanent NTR is important," she said.

"We believe that the timing is important to get this done early, " and "I hope very much that we can get permanent trading status done as soon as possible," she said.

Albright stressed that the WTO accession and permanent NTR for China "should be looked at separately" from the Taiwan issue, which has been raised to a new high pitch in the Capitol Hill since China issued a white paper on Taiwan last month.

Albright said it is important to engage with China, "even though we disagree on a whole host of issues." U.S. Trade Representative Charlene Barshefsky said on Thursday that the Clinton administration is "making good progress" in educating Congress and the public on the necessity of granting China the PNTR.

The U.S.-China agreement on the WTO "is an economic winner for the United States," Barshefsky said in a speech on U.S. trade policy in the 21st century at the Paul H. Nitze School of Advanced International Studies of the Johns Hopkins University.

"All we have to do, to ensure ourselves of the benefits of the agreement, is to grant China on a permanent basis the trade status we have given them every year since 1979, when we normalized diplomatic relations," Barshefsky said.

"It is to make permanent what has already essentially become permanent," she added.

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