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Powell: Extension of NTR to China "Good" for America
US Secretary of State Colin L. Powell stated that extending Normal Trade Relations (NTR) status to China for another year will do "good" for America as well as for the Asia-Pacific region, Hong Kong and Taiwan in particular.
Powell made the statement in an article published by the Washington Post on Friday, the same day when President Bush will submit to Congress a determination calling for granting one-year extension of NTR to China.
Powell said in the article that extension of normal trade relations with China again this year "is clearly in America's interest."
"If we want to take every step possible to promote American interests in Asia, then it is fundamentally in our national interest to extend normal trade relations (with China)," he emphasized.
Last year, U.S. Congress passed legislation granting China permanent Normal Trade Relations (PNTR) as soon as the country enters the World Trade Organization, abandoning what Beijing had seen as an unfair practice of annual review by the US legislature over its trade benefits.
The PNTR legislation, however, has not yet gone into effect since Beijing is still negotiating for accession to the global trading bloc. Therefore, the annual review of China's trading status will be conducted again in the Capitol Hill this year.
"Congress should keep in mind that US exports to China last year grew 24 percent from 1999 to 16 billion dollars -- and provided jobs or other direct benefits to 350,000 to 400,000 US workers," Powell wrote in the article.
He said that American consumers benefit as well from trade with China, since "reasonably priced household goods and clothes from China have helped hold down U.S. inflation in the past few years, and they improve the quality of life for Americans."
Powell's reasoning echoed President Bush who, in a speech on Tuesday at the Los Angeles World Affairs Council, said that trades with China is "a good policy" for America's economy.
China has welcomed the Bush administration's move, but stressed that the NTR is not a favor bestowed by one country on another, but rather a kind of reciprocal trade arrangement given to each other because it is mutually beneficial.
"Not only American business, agriculture, workers and consumers would suffer if Congress were to disapprove normal trade relations this year," Powell said, Taiwan and Hong Kong -- two important US trading partners and friends with substantial interest in the stable, prosperous Chinese mainland -- "would also suffer."
Powell cited Hong Kong economists' estimate that China's loss of NTR would cut Hong Kong's economic growth rate by more than half and eliminate 72,000 to 102,000 jobs.
Taiwan, America's seventh-largest trading partner, "could lose 15 billion dollars in overall exports and as many as 50,000 jobs, should China lose normal trade relations with the United States," he added.
"Most important, we would be undermining the basis for economic relations between the People's Republic of China and Taiwan, a key factor in building mutual trust and confidence between the two," Powell said.
He noted that trade would help China to increase engagement with the outside world and facilitate cooperation between Washington and Beijing in combating alien smuggling, HIV/AIDS, narcotics trafficking, financial crimes, terrorism and environmental degradation.
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