Wu Case Could Imperil China’s Trading Status : Commerce: Angered by activist’s detention, Congress might reverse most-favored-nation action by Clinton.

China’s detention of human rights activist Harry Wu may soon put in jeopardy Beijing’s coveted most-favored-nation trade status, Capitol Hill sources said Friday.

Under the complex rules that govern U.S.-China trade, Congress has until Sept. 1 to consider legislation revoking President Clinton’s decision to allow Chinese goods into the United States for another year under the same low tariffs that apply to most countries.

One congressional staff member said that timetable provides an inviting target for lawmakers, many of them friends of Wu’s, to show their anger at his treatment. Wu, a naturalized American citizen who now lives in Milpitas, Calif., was detained June 19 when he crossed the border into China from Kazakhstan.

“MFN seems to be one of the few levers Congress has,” the staff member said.

Clinton announced June 2 that he would extend China’s trade status. That renewal took effect last Monday. The rules give Congress 60 days to reverse the decision by winning passage of a resolution by both the Senate and House. It would be subject to Clinton’s veto.

But with U.S.-China relations strained by the Wu case and other irritants, it is unclear whether Clinton would risk a confrontation with the Republican-controlled Congress just to assure Beijing of continued low tariffs. “I just hope the Chinese are listening,” one Administration official said in reference to the grumbling on Capitol Hill.

The Senate and House already have passed resolutions condemning Wu’s detention and urging Clinton to “use every diplomatic means available” to obtain his release. The Senate resolution pointedly refers to China’s most-favored-nation trade status, noting, “The Chinese government and people benefit substantially from continuation of such trading benefits.”

Wu, who spent 19 years in Chinese prisons before he was allowed to immigrate to the United States, has testified often to congressional committees about conditions in Chinese prison camps. In May, Wu told the Senate Foreign Relations Committee about China’s alleged sale of organs of executed prisoners.

So far, Republican lawmakers have not criticized the Administration for its handling of the Wu case. One GOP source said Administration officials “are doing everything they can. There is no sense in beating them up over it.”

State Department spokesman Nicholas Burns said the U.S. government will contact Chinese officials every day to demand Wu’s release. He said China has clearly violated a treaty requiring each country to allow visits by diplomats of the other to any of its citizens who may be detained. China has failed to allow U.S. Embassy officials to visit Wu, who was charged today with obtaining state secrets.

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“It’s in China’s interest to have a good relationship with the United States,” Burns said. “These actions are inconsistent with any intention to have a good relationship with us.”

Nevertheless, China has influential supporters in the United States. A group of Americans doing business with China recently accused the Administration of injecting politics into the Wu case. The business people implied that it would be a mistake for the United States to sacrifice its relationship with China over the treatment of one person.

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