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Saturday, July 22, 2000, updated at 16:46(GMT+8)

Delay of Sino-US PNTR Must End

The US Senate's delay in passing the Permanent Normal Trade Relations (PNTR) bill demonstrates that some US politicians still want to leave themselves leeway to snub China and push it to make unreasonable concessions in other areas, said an article in the Beijing-based weekly magazine Outlook.

On May 24, after weeks of lobbying by both supporters and opponents of the legislation, the House of Representatives voted by 237 to 197 to pass the PNTR bill, which will put a stop to the 20-year-old annual review of China's trade status and establish permanent normal trade relations.

As such, supporters of PNTR in the Senate began to feel optimistic that the bill will be successfully passed there.

However, their optimism did not last for long because opposition forces staged an impressive comeback in an attempt to block the passing of the bill in the Senate, the article said.

It has therefore become unclear whether the PNTR bill will ever be ratified.

PNTR, which was originally known as Most Favoured Nations (MFN) status, is a greatly sought after provision by those nations involved in international trade. According to a bilateral trade agreement between the United States and China, which was signed in 1979 and came into effect in 1980, the two countries are required to treat each other as MFN.

However, this trade agreement appears to clash with the articles that relate to China in a 1974 US trade act, which stipulates that China's non-commercial sectors are not eligible for MFN treatment from the United States.

Although the US president has a right to determine whether or not to grant China MFN treatment, the decision must be reviewed by the US Congress.

That is how the annual reviews began.

In the past, the US Congress would review China's trade status and pass the MFN treatment bill that was annually submitted by the government.

Since the 1990s, however, the MFN bills have not been passed smoothly due to the opposition of anti-China senators, who have pointed to China's human rights record, the proliferation of weapons, the trade deficit, the lack of market access, the Taiwan question and the issue of Tibet to try to stop the government from granting permanent MFN status to China.

This has turned the MFN issue into a political landmine, the article said.

Last November, the United States and China signed a package of agreements connected with China's entry into the World Trade Organization (WTO).

According to this package, the US Congress was to cease discriminating against China when reviewing the MFN bill and was to grant China PNTR as soon as possible.

The deal guarantees Chinese goods the same low-tariff access to the US market as is enjoyed by products from other nations. In return, China has pledged to open its market wider to allow US businesses access to sectors ranging from agriculture to telecommunications.

If the PNTR bill is vetoed, this trade agreement between the United States and China will be scuttled.

This should not, however, prevent China from signing agreements with other WTO members.

The US Congress, which did not have much of a say in the trade deal, now has a weapon that it can use against Bill Clinton and the US Government because it has a great deal of leverage over the passage of the PNTR bill, said the article.

On March 8, the Clinton Administration submitted a bill intended to grant China PNTR. This ignited the fuse of one of the longest and fiercest legislative struggles in US history.

On May 25, the US House of Representatives handed the PNTR bill over to the Senate. The battle thus spread from the House to the Senate, pitting Republicans against Democrats.

US Organized labour, a key supporter of the Democrats, bombarded lawmakers with dire warnings that closer trade ties would undermine human rights in China and cost hundreds of thousands of US jobs.

Despite an intense blitz of lobbying launched by opposition forces in the Senate, it is expected that the PNTR bill will pass by a larger-than-expected margin in the Senate.

Sixty-three lawmakers of the 100-member Senate said in a recent Reuters poll that they would vote in favour of PNTR, enough to override a vote-blocking filibuster.

As there are enough supporters to pass the bill, those who oppose it have started to try and stop the bill being considered and voted at all.

They are doing this in part because they want to use PNTR to push Bill Clinton to ratify the US$13 billion budget plan crafted by Republican Congressmen.

Also, anti-China forces in the Senate want to win time to put forward another amended PNTR bill, the article said.

The leader of the Democratic opposition in the House, Representative David Bonior of Michigan, said the fight was far from over. "Our struggle for human rights, workers rights and the protection of the environment has just begun," he said.

Senate Foreign Relations Committee Chairman Jesse Helms, one of the president's harshest critics, vowed to use a range of issues relating to China to fight the president.

Senate Republican Leader Trent Lott was keen to approve sanctions aimed at curbing the alleged sale of Chinese weapons to Pakistan and other nations. To delay the passage of the PNTR bill, he wants the Senate to consider a series of key spending bills, which are connected to the funding of the federal government, before turning to the PNTR bill.

The delay has outraged business groups, the White House and pro-trade Democrats in the Senate because it will directly hurt the interests of the United States.

Yet, despite opposition, it seems that the passage of the bill is only a matter of time, the article asserted.

However, the bill must be passed unconditionally, stressed the article. If strings are attached, further difficulties will be created to aggravate Sino-US relations. This would be more harmful than the China-bashing rhetoric of the PNTR opposition in the US Senate.

In This Section

The US Senate's delay in passing the Permanent Normal Trade Relations (PNTR) bill demonstrates that some US politicians still want to leave themselves leeway to snub China and push it to make unreasonable concessions in other areas, said an article in the Beijing-based weekly magazine Outlook.

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