Clinton Ties China’s Trade in Future to Human Rights : Asia: He extends favored-nation status. Legislators back demand that Beijing improve policies by next year.

President Clinton on Friday ended three years of battles between the White House and Capitol Hill over China’s trade benefits, winning the backing of Democratic leaders for an executive order demanding that the Beijing regime improve its human rights policies during the next 12 months.

The order, signed by Clinton early Friday, extends China’s most-favored-nation trade privileges in this country for another year, until mid-1994. But it also says that if China wants to get further annual renewals, Beijing should make “overall, significant progress” on human rights questions such as releasing or accounting for political prisoners.

The action represents the first time that the United States has imposed conditions on the renewal of Beijing’s favorable trade status, under which Chinese goods can be imported into this country at the same low tariffs enjoyed by most other countries. China and some representatives of the U.S. business community had strongly urged an unconditional extension of the status.

China promptly protested Clinton’s decision. A Foreign Ministry statement, quoted by the official New China News Agency, said that the conditions are an “open violation” of the principles that form the basis for Sino-U.S. trade and diplomatic relations.

After China’s repression of the 1989 pro-democracy demonstrations, the Democratic Congress repeatedly passed laws that would have imposed conditions on the annual renewal of China’s trade benefits, but all were vetoed by President George Bush.

Clinton’s order is more weakly worded than the legislation Democrats had sponsored. For example, it abandons efforts to link favorable trade renewal to improvements in China’s trade and arms-export policies. Nevertheless, with a Democratic President in the White House, the legislators who had led the attacks on Bush’s China policy--such as Senate Majority Leader George J. Mitchell (D-Me.) and Rep. Nancy Pelosi (D-San Francisco)--gave the Administration policy their endorsement.

“Starting today, the United States will speak with one voice on China policy,” Clinton said in a written statement. “We no longer have an executive branch policy and a congressional policy. We have an American policy.”

The issue remains so politically sensitive that, even with Mitchell and Pelosi standing by his side at the White House, Clinton avoided any public ceremonies for his executive order. Instead, he signed the order behind closed doors and left it to the two congressional leaders to answer reporters’ questions.

“Many people in Congress would like much, much tougher conditions placed on this (China’s) trade,” Pelosi admitted. “Certainly, within the next year, if China does not comply with the President’s executive order . . . there will be through the Congress like wildfire a vote to deny (favorable status).”

Clinton’s order requires Secretary of State Warren Christopher to recommend next year whether the President should extend China’s trade benefits for the 12 months after July 3, 1994. The order says that the secretary should not recommend any favorable trade renewal unless China has made progress in several human rights areas, including the following:

* Releasing and providing an acceptable accounting for political prisoners. China still holds thousands of people it labels counterrevolutionaries in its prisons, and authorities have regularly refused to provide a full list of them.

* Ensuring humane treatment of all prisoners, “such as by allowing access to prisons by international human rights organizations.” The Beijing regime has refused to grant organizations such as the International Committee of the Red Cross the right to visit its prisons.

* Protecting “Tibet’s distinctive religious and cultural heritage.” The Dalai Lama, the Tibetan spiritual leader, has repeatedly protested that China is destroying Tibetan culture by moving ethnic Han Chinese into Tibet and by pressing Tibetans to speak and write in Chinese.

* Permitting international radio and TV broadcasts into China. China has often jammed the broadcasts of organizations such as the British Broadcasting Corp. and the Voice of America in an effort to limit the information available to its 1.1 billion citizens.

Clinton’s order was quickly criticized by Senate Minority Leader Bob Dole (R-Kan.), who said he would have extended China’s benefits without these conditions.

“Every year American farmers and manufacturers have to hold their breath to see if their ability to do business with China will be cut off,” Dole said in a statement. “Now they are guaranteed another year of uncertainty.”

But the President’s action was hailed by some leaders of the dissident forces who have long opposed the Beijing regime.

“We believe this year the Chinese government will . . . release political prisoners, because the message is very clear,” said Zhao Haiching, president of the National Council on Chinese Affairs, a dissident group.

Lodi Gyari, a Tibetan representative for the Dalai Lama, told reporters he was “very happy with the President’s position. I think it sends a very powerful signal. It certainly is a very bold step in the direction to serve Tibet as a nation and as a culture.”

Friday’s order was the culmination of five months of maneuvering in which Clinton Administration officials found themselves negotiating both with China and with Congress. As part of the talks, Christopher met with the Chinese ambassador to Washington and the President sent Assistant Secretary of State Winston Lord to Beijing.

On Friday, Lord said Clinton’s action represents “an attempt to begin to move the most-favored-nation debate from the center of our policy and construct a broader China policy. But this will require substantial movement by the Chinese in our areas of concern.”

In the most optimistic assessment of the day, Pelosi appeared to suggest that within a year Clinton’s action could lead to the sort of democratic reforms China’s Communist regime has resisted for more than four decades.

“Hopefully, at the end of this 12 months, if there is freedom of the press in China, and if there is freedom of speech in China, and the other human rights conditions are met, then we can begin to solve some of the other problems that members of Congress have,” Pelosi said.