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Clinton Reverses His Policy, Renews China Trade Status : Commerce: President ‘de-links’ most-favored-nation privilege from human rights. He admits failure of earlier course and says broader strategic interests justify switch.

TIMES STAFF WRITERS

President Clinton, abandoning a central foreign policy principle of his Administration, announced Thursday that he has decided to “de-link” China’s privileged trading status from its human rights record.

While acknowledging that China “continues to commit very serious human rights abuses,” Clinton said that he has come to believe that broader American strategic interests justify the policy reversal.

Striking a defensive, almost apologetic posture at a late-afternoon White House briefing, Clinton acknowledged that his previous approach to U.S.-China relations had failed and said that he intends to set a new course.

“That linkage has been constructive during the past year, but I believe, based on our aggressive contacts with the Chinese in the past several months, that we have reached the end of the usefulness of that policy,” Clinton said. ". . . We need to place our relationship into a larger and more productive framework.”

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Therefore, Clinton said, he will renew China’s most-favored-nation status, meaning that Beijing can ship its exports to the United States on the same tariff terms as most other American trading partners.

Last year, China exported about $31 billion worth of goods to the United States, running a trade surplus of $23 billion. The United States exported $8 billion in goods to China.

The only limit Clinton imposed on the China trade is a ban on U.S. sales of Chinese-made guns and ammunition, which amounted to about $100 million last year.

Clinton dropped the idea of forming a human rights commission to monitor progress in China. The Chinese rejected such a body as an insult to their sovereignty, and human rights groups derided it as likely to be ineffective.

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The President announced his new China policy in the White House briefing room. Unlike previous major presidential announcements, he appeared alone, without Secretary of State Warren Christopher or senior White House aides.

Clinton seemed prepared to take the inevitable criticism that his change in course generated. Lawmakers on Capitol Hill, human rights organizations and Chinese dissident groups immediately expressed anger and dismay.

Human Rights Watch (Asia) called the Clinton announcement “one more capitulation on human rights.”

“Clinton has left his Administration looking vacillating and hypocritical, while the Chinese leadership, by contrast, has emerged as hard-nosed, uncompromising and victorious. We’re deeply disappointed by this decision,” said Sidney Jones, executive director of the organization.

AFL-CIO President Lane Kirkland, in a particularly scathing statement, said that Clinton’s decision “sends a clear message to the world: ‘No matter what America says about democracy and human rights, in the final analysis profits, not people, matter most.’ . . . America should be standing with the Chinese people, not their oppressors,” he added.

Senate Majority Leader George J. Mitchell (D-Me.), an important ally of the President’s on health care and other major policy initiatives, also quickly criticized Clinton’s new China policy.

“I disagree with the decision. . . . The experience of recent years has been that each concession to the Chinese Communist regime encourages its intransigence, and I believe this will be the unfortunate result of this decision,” Mitchell said. “It will confirm for the Chinese Communist regime the success of its policy of repression on human rights and manipulation on trade. It is likely to produce a result that is the opposite of what the President intends.”

Mitchell added that, when Congress returns from its Memorial Day recess, he will introduce legislation to reverse Clinton’s decision. That legislation probably will be similar to bills sponsored by Mitchell and Rep. Nancy Pelosi (D-San Francisco) during the George Bush Administration, attaching conditions to future renewals of China’s trade status.

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Bush repeatedly vetoed such legislation, and in 1992 Clinton accused him of “coddling dictators” in China. During his presidential campaign, Clinton also specifically endorsed the idea of imposing human rights conditions on the renewal of China’s trade benefits.

Sen. John McCain (R-Ariz.), defended the decision on policy grounds. But he underscored that Clinton was adopting precisely the Bush Administration policy that he assailed as cynical during the 1992 campaign. Renewing most-favored-nation status for China “is a sound, if politically embarrassing, decision,” McCain said.

Clinton said he believes he reached the right decision and said he is prepared to defend it.

“I want to make it clear to you I do not do this with rose-colored glasses on,” Clinton said. “I know there will be, no matter which approach we take . . . , continuing human rights problems.”

Clinton’s answer to his critics echoed the rhetoric of the Bush and Ronald Reagan administrations in addressing the question of doing business with undemocratic regimes, whether in China or South Africa or elsewhere.

Bush and Reagan argued that engagement rather than confrontation with these governments was the preferable course, because any ruling group would bristle at being subject to outside pressure.

On Thursday, Clinton gave a lengthy defense of the Bush--and now Clinton--policy.

“To those who argue that in view of China’s human rights abuses we should revoke MFN status, let me ask you the same question that I have asked myself over and over these last few weeks as I have studied this issue and consulted people of both parties who have had experience with China over many decades. Will we do more to advance the cause of human rights if China is isolated or if our nations are engaged in a growing web of political and economic cooperation and contacts?” Clinton said.

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Further explaining his new policy, Clinton noted that conditions in China and elsewhere in Asia have changed since he signed an executive order last year requiring “overall significant progress” on a number of human rights fronts.

He said that Christopher could not certify that China had met such conditions, but he said that he was dropping the trade-human rights link for several reasons, including severe political tensions between Beijing and the Chinese provinces, a desire on the part of China’s aging leadership to “preserve order” and the fact that no government responds well to outside threats.

Clinton noted that North Korea’s nuclear weapons program and belligerent attitude toward South Korea also justify American rapprochement with Beijing in the interests of larger Asian security concerns.

In briefings with reporters, Clinton’s advisers sought to put the best face on his about-face.

Robert E. Rubin, the head of Clinton’s National Economic Council, insisted that the decision “was not made as a result of pressure” from the American business community. But he also predicted that the policy will open the way for greater trade between American companies and China.

“I think (China) will become an ever larger and more important trading partner,” Rubin said.

In Beijing, a Western diplomat said that Clinton’s curb on sales of Chinese guns and ammunition may not hurt the Chinese small-arms industry much because “exports to the U.S. increased significantly last year when the Brady bill was under consideration.”

“They (importers of Chinese arms) may have been stocking up in anticipation of this type of thing. They may have defended themselves by stocking up. The handwriting has been on the wall for some time.”

Asked whether Clinton’s action will alienate leaders of the Chinese People’s Liberation Army, the diplomat replied: “From the military point of view this is nowhere as bad as it could have been. It could have been much worse. It doesn’t strike directly at the military and the important interests they represent. . . . This will be seen as light.”

Times staff writers Rone Tempest in Beijing and Michael Ross in Washington contributed to this report.

* CALIFORNIA CHEER: State businesses, economy stand to benefit from move. D1


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