China Greets Gore With Deals for Boeing, GM

Launching the highest-level official U.S. visit to China since the bloody Tiananmen Square crackdown of 1989, Vice President Al Gore arrived here Monday, and a grateful China thanked the United States by signing two major deals with American companies.

Gore and Chinese Premier Li Peng witnessed today’s signings of a $685-million order for five Boeing Co. 777-200 passenger jets and an agreement with General Motors to create a $1.3-billion joint venture to produce 100,000 Buicks a year in China.

In the Great Hall of the People, Gore, Li and an array of Chinese and U.S. officials stood behind principals of the deals as they signed their agreements. Afterward, the officials toasted the agreements, and Gore sloshed champagne on the floor as he clinked glasses with Li.

“These transactions . . . are proof positive that there is greater economic cooperation between China and the United States,” Gore spokeswoman Ginny Terzano said in advance of the ceremony. “This is an important landmark in China-U.S. relations.”

The deals with GM and Boeing were long in the making, and the Chinese government, which still controls the vast majority of China’s economy, was following a well-worn tradition of sealing major business transactions to coincide with a visit by an important foreign official. “You can assume that the fact that the vice president is here visiting provides good timing” for the agreements, a senior Clinton administration official said here, requesting anonymity.

Gore’s four-day visit is somewhat clouded by the political controversy at home over allegations that China illegally tried to influence U.S. elections. The charges, being investigated by the Justice Department, are among an array of campaign-finance troubles plaguing the Clinton White House.

The vice president has said he will raise the issue of influence-peddling during his talks with Li or President Jiang Zemin, but he stressed that the focus of his trip is promoting stronger relations. Issues on his list for discussion include trade, human rights, the environment and nuclear nonproliferation.

“I have traveled here to reaffirm the vital importance of relations between our nations,” Gore said in a statement issued upon his arrival in Beijing on Monday evening. “The landscape of U.S.-China relations is filled with many rivers, some flowing together, others flowing apart. Such variety befits the interaction of two great nations and civilizations.”

For his part, Li told Gore during meetings this morning: “We believe the United States, the biggest developed country in the world, should play a more positive role in international affairs. The improvement of our relations serves the interest of both peoples.”

By going forward with his trip despite the potentially adverse political effects, Gore sent a strong signal to China that the Clinton administration will not let the campaign-finance controversy interrupt high-level contacts between the two governments or inhibit efforts to improve trade ties.

“The visit has enormous significance to the Chinese,” said Mike Jendrzejczyk, a China policy analyst and Washington director of Asia Watch, a human rights organization. “It demonstrates that the United States wants to remove the Tiananmen stigma for once and for all.”

The visit is particularly timely for Jiang, who took power when longtime senior leader Deng Xiaoping died last month and is striving to consolidate control. Jiang hopes to visit Washington in November and to host President Clinton on a reciprocal visit next year; Gore’s visit is seen as a steppingstone to those trips.

Gore’s decision to witness the ceremony cementing the automobile and airplane deals with Li appeared to be another signal that China has been rehabilitated in the eyes of the White House. Li is the hard-liner who in 1989 declared martial law, ordered troops into the famous central square of Beijing and is widely blamed for the killing of hundreds of peaceful pro-democracy demonstrators in and around Tiananmen.

The Gore visit also shows how much the Clinton administration’s China policy has changed since the 1992 U.S. presidential race. Then, Clinton and Gore made China their most important foreign policy campaign issue, repeatedly chastising incumbent Republican President George Bush for being too soft on the “butchers of Beijing” after the Tiananmen bloodshed.

The Boeing deal was signed with the Civil Aviation Administration of China, and the aircraft will be used by the state-run Air China. More than 4,500 U.S. suppliers are expected to provide parts and services for the planes, three of which will be delivered in the fourth quarter of 1998, with the other two following in 1999.

“There may be more planes further down the pike,” a senior Clinton administration official said. The official denied reports in recent days that the deal in the making was to have been larger.

The automotive deal is with the state-owned Shanghai Automotive Industry Corp. The U.S. and Chinese partners are expected to invest equally in the venture, according to administration officials.

GM estimates that the project will generate about $1.5 billion in U.S. exports over the first five years of its existence--$400 million in machinery and $1.1 billion in parts and components.

Gore traveled to Beijing from Tokyo, where he and his wife, Tipper, met with Emperor Akihito and Empress Michiko. Gore spoke on environmental issues at a later conference and had lunch with Prime Minister Ryutaro Hashimoto.

Times staff writer Rone Tempest contributed to this report.

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China sale marks a breakthrough for Boeing. D1