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Clinton's U Turn Won't Mean China Gets A Free Ride


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CLINTON'S U-TURN WON'T MEAN CHINA GETS A FREE RIDE

A controversial Washington rite of spring seems headed for extinction with President Clinton's expected decision to renew China's most-favored-nation (MFN) trade status. Ever since the 1989 Tiananmen Square massacre, human-rights advocates and their backers in Congress have tried to force the White House to use its annual review of China's access to the U.S. market as a club to make the Beijing government treat its people better. But in a political about-face, aides say Clinton will no longer link trade to human rights, a change that puts U.S.-Chinese relations on a more stable footing.

Realizing that relations with China are too valuable to jeopardize over a single issue, Clinton is removing the source of greatest friction and mistrust in relations between Washington and Beijing. But that doesn't mean tensions will fade away. Instead of converging on one major focal point such as MFN, conflicts will be played out over a host of economic, security, and political issues.

For starters, U.S. officials are bracing for dollar-for-dollar retaliation from Beijing if Clinton imposes even token sanctions. Says a senior Administration official: "The Chinese don't play the game soft." That means U.S. business will lose some contracts, although the value will be small.

trade abuses. But decoupling MFN from human rights will let Clinton play hardball, too. Without having to worry that everything he says could prompt Congress to revoke China's trade status, the President can be more blunt about Beijing's dismal treatment of political prisoners, says Gerrit W. Gong, director of Asian studies at the Center for Strategic & International Studies in Washington. Indeed, Clinton is expected to step up pressure on China to permit prison visits by the International Committee of the Red Cross.

At the same time, U.S. trade hawks will have more freedom to crack down on trade abuses. China's mounting trade surplus almost certainly will become a target of greater U.S. criticism. And officials already are planning to cite China as a "priority" violator of American intellectual property rights. "It's going to happen," vows a senior Administration official, who says there's no way China can make enough progress by a July 1 deadline to avoid censure. The move will immediately launch a formal investigation into Chinese piracy of software and recordings that could lead to curbs on China's exports to the U.S.

Washington also can be counted on to make it as tough as possible for China to gain entry to the General Agreement on Tariffs & Trade (GATT). U.S. trade officials insist that Beijing must first reform its banking system, liberalize its financial markets, and publish its still-murky trade regulations. "The Chinese have a long way to go" before their economy acquires enough free-market characteristics to warrant GATT membership, says a senior U.S. official.

On the security front, the U.S. and China could tangle over the North Korean nuclear threat if Washington presses for sanctions on Pyongyang. Beijing opposes stiffer curbs. U.S. arms controllers hope also to revive talks with China aimed at extracting a firm pledge not to peddle advanced missile technology. That will be tough since China's leaders are still sore about sanctions Clinton imposed last summer for missile tech transfers to Pakistan.

Capitol Hill, which has been backpedaling furiously to delink MFN and human rights, may yet trigger tiffs with China over Taiwan and Hong Kong. Beijing is already doing a slow burn over legislation passed this spring that urges lifting restraints on U.S. arms sales to Taiwan. The Administration opposes both that shift and the mounting congressional calls to upgrade relations with Taiwan. But the Chinese may not appreciate the distinction between the executive and legislative branches, and could complain about U.S. meddling in sensitive matters. Another potential dispute: Elections in Hong Kong next year could rekindle congressional pressure for democratic reforms in the British colony--which China would resent bitterly as it assumes control by 1997.

But barring another Tiananmen-like crackdown, U.S.-China relations seem headed for a level of maturity. No longer will the two sides roll the dice every year and put the very heart of their economic relationship in doubt. But a dramatically expanding U.S. economic, security, and diplomatic engagement with China will keep U.S. attention focused on the Middle Kingdom. That might just mean the Americans will pursue their own distinctive mix of self-interest and idealism with renewed vigor.Amy Borrus in Washington, with Douglas Harbrecht


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