Clinton seeks to extend China's top trade status without seeming soft on rights


WASHINGTON -- In a delicate balancing act, President Clinton is trying to craft conditions on trade with China that are tough enough to satisfy expectations but not so harsh as to wreck U.S.-Chinese relations.

Mr. Clinton is expected to issue an executive order this week extending China's favorable trade status but tying future extensions to improved behavior, especially in the realm of human rights.

The fine print will be read worldwide. And the political stakes embedded there will be high.

Mr. Clinton found China's human rights abuses a useful political club to wield against President George Bush, who steadfastly refused to put the United States' ties with China at risk despite notorious human rights abuses, weapons proliferation and unfair trade barriers.

At the Democratic National Convention that nominated him, Mr. Clinton promised an administration "that will not coddle tyrants, from Baghdad to Beijing." In another speech, he charged that Mr. Bush had "failed to stand up for our values" after China's government attacked demonstrators in Tiananmen Square in 1989.

Now, if his decision is deemed too weak, "the Republicans will remind Democrats of previous statements against Bush," said William C. Triplett, Republican counsel to the Senate Foreign Relations Committee.

In recent weeks, new reports have underscored China's flouting of international norms, including evidence of the sale of M-11 missile technology to Pakistan that Secretary of State Warren M. Christopher said in congressional testimony he took "very seriously."

And a human rights group, the Laogai Research Foundation, charged last week that China continues to export prison-labor goods to the United States in violation of an agreement with the United States last August.

Other allegations

To these allegations, members of Congress have added outrage over China's forced-abortion and sterilization policies, accounts of which Mr. Christopher said he found "very abhorrent." And China's trade deficit with the United States climbed to $18.5 billion in 1992 and continues to grow.

But countervailing pressures are also building on a president who has made economic expansion through trade a centerpiece of his foreign-policy agenda.

Business interests are desperate not to lose investment opportunities in China's expanding market and low-wage economy. And Hong Kong, despite its own problems with Beijing, has argued that it would suffer economically if U.S.-China trade were slashed.

"China is now the third-largest nation in the world in gross product, fastest-growing in the world economically -- 12 percent last year," U.S. Trade Representative Mickey Kantor told reporters this week. "You cannot ignore the economic impact China is making on the world."

The impact is not just economic. With its veto at the United Nations Security Council, China is vital to carrying out American policy in Bosnia, Iraq, Cambodia, Somalia and anywhere else where collective action is necessary.

Preparing for a decision on a renewal of China's favored trade status, the administration dispatched the State Department's top Far East official, Winston Lord, to Beijing, to press the Chinese for change. But both he and Mr. Christopher expressed disappointment with the outcome.

Yesterday, China's president, Jiang Zemin, warned that both the United States and China would be hurt economically if China's most-favored-nation trading status was not extended by Washington.

"In my view, the United States is important to China's foreign trade," Mr. Jiang added. "Likewise, China is not insignificant to U.S. foreign trade."

Mr. Clinton's advisers are basically in agreement but have not yet forwarded their final recommendation to the president, an administration official said.

Under law, Mr. Clinton must decide whether to continue most-favored-nation status for China by June 3. But the official predicted that his decision would be announced sooner, so that the president could assume an aggressive posture and not look as if he had been pushed up against a deadline.

Congressional skeptics, who suspect that Mr. Clinton may subordinate human rights and nuclear proliferation to economics, fear that an aggressive posture may be all there is. That is why some would prefer having conditions imposed by law rather than by executive order.

They are wary of what one called a "Pakistan solution," referring to the legal flexibility granted to the president to ignore evidence of Pakistan's nuclear program so as not to disrupt relations with that Cold War ally.

But a critic of China, Jeffrey Fiedler, an AFL-CIO official and director of the Laogai Research Foundation, said of an executive order, "I think it would have the same impact on the outcome over time as legislation." Also, he said, "it gives China some modest face."

"The judgment in the end has to be made on what the conditions are, not the sort of form the conditions come in," Mr. Fiedler said.

Political complexities

More than Mr. Clinton's political standing is at stake. With the aim of developing a governmentwide position, the administration has worked with Sen. George J. Mitchell, the Maine Democrat who is Senate majority leader, and Rep. Nancy Pelosi, a California Democrat, both of whom recently reintroduced legislation to impose conditions on trade with China.

If the president opts for an executive order instead of legislation, both would be expected out of party loyalty to drop their own bills. But in that event, they might be put in the embarrassing spot of having to fend off Republican initiatives with the same intent as theirs.

Ms. Pelosi, daughter of the late Baltimore mayor Thomas A. D'Alesandro Jr., made clear in an interview that she expects Mr. Clinton to stick to tough human-rights conditions similar to those contained in her legislation.

"The relationship is contaminated," she said. "We have to correct it. I never doubted the president would do the right thing."

She rejects arguments that China would retaliate harshly.

"There's no way the Chinese can walk away," Ms. Pelosi said. "These people are not going to give up their profits for [the sake of keeping] political prisoners."

China's rulers, she said, "don't like democracy, and they don't respect human rights, but they love money."

Although Mr. Clinton has also to address unfair trade and weapons proliferation in his announcement, Ms. Pelosi said, he need not tie them to MFN renewal, because China can already be penalized under existing law.

If Ms. Pelosi's hopes are not fulfilled, the impact on China could be significant, said a former senior Bush administration official who opposed Mr. Bush's China policy. With the Democratic Congress and president in sync, this person said, China could feel it is getting a "green light."

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