Advertisement

U.S., China in Talks on GATT Rules : Trade: China wants Washington’s backing in membership bid. Key issue is whether Beijing should get more lenient terms.

Share
TIMES STAFF WRITER

The Clinton Administration and China launched an intensive, high-level drive Friday to resolve the most important and acrimonious dispute between the two countries, trying to settle on the rules that will govern China’s future economic relations with the rest of the world.

Secretary of State Warren Christopher and Chinese Foreign Minister Qian Qichen met for 45 minutes in the first of three scheduled Cabinet-level meetings between the two countries this weekend. They will be followed by a summit meeting between President Clinton and Chinese President Jiang Zemin on Monday. Clinton will arrive in Jakarta on Sunday to attend an Asian trade conference.

In all of the sessions, China is expected to press the United States to support its bid for membership in the General Agreement on Tariffs and Trade. In effect, China wants to join the club of the world’s leading trading nations, and to do so as quickly as possible.

Advertisement

The main question is whether China--now emerging as one of the world’s leading economic powers--should be given different, more lenient treatment than American, Western European and Japanese companies in the world trading system.

The dispute has huge implications for American companies that try to sell their goods in China. At issue is the extent to which China may give special protection for its own industries, and to favor them over foreign products or companies, as it enters the GATT and its successor, the new World Trade Organization.

When American companies try to do business in China, “we still often face a Chinese market that is closed,” Assistant Secretary of State Winston Lord told reporters Friday.

The controversy is also important beyond the United States and China.

U.S. officials say that if they let China enter the world trading system on special or privileged terms, they may be asked in the future to do so for other countries.

“Any special conditions we give to China will have broad implications for the next members of GATT,” one senior Clinton Administration official explained. “There hasn’t been a major new member of GATT for a long time. All of us recognize that Russia and the Eastern European countries will be next in line.”

For months, China has been arguing that it is still an impoverished, developing country and should not be forced to compete on equal terms with developed nations. Chinese officials point out that China’s per capita income level remains low, no more than a few hundred dollars per year.

Advertisement

But American officials counter that China’s economy is growing so fast that it cannot be lumped with developing countries such as, say, Rwanda, which have weak economies.

“China is the second- or third-largest economy in the world,” U.S. Trade Representative Mickey Kantor told reporters Friday. “It has a $28-billion trade surplus with the United States. . . . I don’t think China’s situation would enable it to be considered a developing country.”

Kantor is expected to meet with China’s minister of foreign economic relations and trade, Wu Yi, for more than three hours Sunday in what appears to be a determined effort to settle the dispute. Secretary of Commerce Ronald H. Brown will also meet this weekend with the trade minister.

Over the last few weeks, Administration officials say, China has suggested repeatedly that if it cannot get what it wants from the Clinton Administration on the GATT issue, then it will block progress toward trade liberalization at the summit of Asian nations that Clinton will attend here next week.

The Clinton Administration and other nations, such as Indonesia, are asking the leaders of the 18-nation Asia-Pacific Economic Cooperation forum to adopt a joint statement pledging to work for free trade in the region by a fixed date, such as 2020.

“The Chinese have been trying to say, ‘Our price for signing the (Asian) leaders’ statement is U.S. support for China’s admission to GATT,’ ” one senior U.S. official said.

Advertisement

China has been bargaining hard to gain admission to the world trading group in time to be considered a special member of the new World Trade Organization when it is set up in January. And Beijing has applied the brunt of its pressure on the United States, which it views as the principal obstacle to getting into GATT on the terms it wants.

Advertisement