Sunday, February 27, 2005

By Tyler Marshall, Times Staff Writer

WASHINGTON � A quiet, yearlong diplomatic effort by the Bush administration to stop America's European allies from lifting a long-standing arms embargo against China is threatening to erupt into a very public transatlantic row, U.S. officials and outside experts say.

Although President Bush's just-completed fence-mending visit to Europe appeared, at least temporarily, to lower tensions between the administration and its oldest allies on several fronts, including Iraq and Iran, it exposed the depth of transatlantic differences over selling military equipment to China.

Despite U.S. objections, the European Union's 25 member states are widely expected to lift the 16-year-old embargo, possibly during the first half of this year. Public comments by Secretary of State Condoleezza Rice this month led some observers to believe that the Bush administration would acquiesce to that step to win European backing for the president's Middle East agenda.

But after meetings with European leaders and senior EU officials in Brussels on Tuesday, the president gave no ground on the issue, instead noting America's "deep concern" and offering his European partners little more than a hard time from an angry U.S. Congress if they dropped the embargo without first alleviating American concerns.

Bush's response was in sharp contrast to the softer language and more conciliatory tone used in addressing other divisive subjects during the trip.

"I would not say that the two sides are close to a compromise," a senior administration official said in the wake of Bush's meetings in Brussels. "We're at an early stage of an intensive phase of discussions" with the Europeans.

European diplomats said Bush's words had refocused European efforts to address American concerns, but gave no hint that the EU would pull back from the decision to lift the embargo. Experts on the issue questioned how the ban could be lifted without sparking serious new transatlantic tensions.

"It's difficult to see how Europe and the United States can find common ground," said Adam Ward, an East Asia security specialist at the International Institute for Strategic Studies in London.

Although overshadowed during the run-up to Bush's trip by more pressing differences on Middle East policy, the stakes involved in strengthening China's military are potentially enormous. With Beijing increasingly determined to bring Taiwan under its control and the U.S. committed to defending the island democracy just 100 miles from the mainland, there is a possibility of armed conflict, although not imminent, specialists said.

"If you look where the United States could come into conflict with a genuine nuclear power, the only place is in the Taiwan Strait," said David M. Lampton, director of Chinese studies at the Nixon Center, a Washington-based think tank. "You can imagine what the [political] impact would be if technology that originated in the United States and sold by the Europeans to China was used to kill American troops."

In Senate testimony this month, both Defense Secretary Donald H. Rumsfeld and CIA Director Porter J. Goss expressed concern about the dramatic growth of China's military capability.

"Beijing's military modernization and military buildup is tilting the balance of power in the Taiwan Strait," Goss said.

Such assessments have only heightened the political concern on Capitol Hill about Europe's intentions.

This month, the House overwhelmingly passed a resolution rejecting Europe's decision. Lawmakers across the political spectrum, including a leading backer of strong transatlantic ties, Sen. Joseph R. Biden Jr. (D-Del.), are cosponsoring a similar move in the Senate.

Both House International Relations Committee Chairman Henry J. Hyde (R-Ill.) and Senate Foreign Relations Committee Chairman Richard G. Lugar (R-Ind.) used uncharacteristically harsh language last week to criticize EU plans to lift the embargo. Hyde, writing in the Wall Street Journal, dismissed European proposals to replace the embargo with a nonbinding Code of Conduct governing sales to China as an attempt to mask its action. Hyde said it had "all the vitality of mortuary cosmetics and an equivalent purpose."

"It's very troubling," said Rep. David Dreier (R-San Dimas), a leading congressional advocate of expanding commercial ties to China. "I'm strongly opposed to lifting the embargo."

Lugar indicated last week that he would back restricting U.S. technology transfers to European allies unless the European Union could guarantee that such technology would not be passed to China.

The United States and its major European allies slapped the embargo on Beijing in the wake of the June 1989 Tiananmen Square massacre, arguing they should not supply armies that shoot their own people. As on many issues, however, transatlantic interests in regard to Chinese arms have diverged in the post-Cold War era.

With China's dazzling economic growth, Europeans have come to see strong trade ties with Beijing as a key to boosting their sluggish economies. They insist that lifting the arms embargo would be more symbolic than substantive, an act that would end the anomaly of lumping China with Zimbabwe and Myanmar and give Beijing's leadership the "face" it needs to expand its trade relationships more rapidly.

Looking warily at China's military build-up, the United States sees it much differently. American officials believe that every piece of additional military hardware sold to China strengthens a potential adversary and adds to regional instability.

"The ongoing modernization of the People's Liberation Army is a major factor in convincing the Chinese leaders that they actually have military options to solve the Taiwan problem," said Richard Fisher, an Asia defense specialist at the International Assessment and Strategy Center, a small Washington-based think tank.

U.S. officials and outside experts say the Bush administration has already exerted political pressure behind the scenes to diminish the flow of high-tech military hardware to China. A senior State Department official involved in these efforts said repeated trips to Europe over the last year had slowed EU plans to lift the embargo.

"We were instrumental in slowing this down," the official said. "Most people thought it would happen before the middle of 2004."

During the Clinton administration, in what has been described as a painful dialogue, the United States pressured Israel in 2000 to cancel a potentially lucrative sale to China of its Phalcon airborne early warning and control system, and then persuaded Tel Aviv to impound a fleet of anti-radar Harpy drone aircraft that was delivered to China in the mid-1990s but returned to Israel for upgrading.

Europeans insist they have no intention to supply major new weapons systems to China. But American specialists say that's not the point � Russia has already delivered new ships and aircraft to Beijing.

"Communications, command and control technology, intelligence, surveillance and reconnaissance � this is their biggest problem," said Kurt Campbell, a former deputy assistant secretary of Defense for Asian and Pacific affairs. "They want help in linking together their weapons systems and achieving better battlefield awareness."

Campbell and other experts say Europe could help in this area. Fisher, for example, noted that even with the arms embargo in place, Europe has sold China nonlethal equipment that has potential military applications.

In a paper published last month, he listed six examples, including micro-satellite technology from Britain that could be used to destroy U.S. military satellites, high-technology jet engine fan blades, also from Britain, and German-made diesel engines for use in China's Song-A class conventional attack submarines.

"The best outcome for the United States would be not to just keep the embargo, but strengthen it," Fisher said. "But from the European perspective, this is impossible."

Last month, the U.S. gained a valuable ally when Japan came out against Europe's intended move. Also, EU countries are discussing steps that would make military-related sales to China more transparent. But U.S. officials remain skeptical.

"This doesn't fulfill our concerns by any stretch," the senior State Department official said.

* Times staff writer Edwin Chen in Washington contributed to this report.