Taiwan Communiqué No. 90, March 2000

The WTO / PNTR debate

"Normal" trade for China?

On 4 March 2000, the New York Times reported that the Clinton Administration had decided to accelerate the schedule for Congressional approval of "permanent normal trade relations" (PNTR) for China. According to the report, Mr. Clinton would send the bill to Congress as early as Wednesday, 8 March 2000 (New York Times, "Clinton to send China trade bill to Congress soon").

The bill forms part of a package, agreed to by the United States and China in mid-November 1999, containing a number of market-opening measures China must take to gain American support for China's entry into the WTO. In return, the Clinton Administration agreed it would push to end the annual Most Favored Nation (MFN) review.

Taiwan Communiqué comment: While in the long run it would indeed be desirable to have China in the WTO, this is not the right time to do it. The US would be "rewarding" China in spite of its belligerent behavior against Taiwan, in spite of its continued repression in Tibet, and in spite of the continued gross violations of human rights in China itself.

Also, China is still a centrally-planned economy in which state-enterprises have a major role. The transition towards a true market economy will be accompanied by much instability. Its track record of keeping agreements is deplorable at best. Time and again, one sees that China violates the agreements it enters into, whether this is on the issue of piracy of CD's and software, or export of rocket technology to countries such as Pakistan and North Korea.

The best strategy to try to influence China for the better is to make it crystal clear that it needs to amend its behavior before it can expect "normal" trade relations. As was stated so eloquently by US Congressman Sherrod Brown (D-OH) recently: "…we cannot afford to turn a blind eye to China's intimidating tactics. China's threat of military action against their democratic neighbor should send a message to every member of Congress. We cannot afford to dole out increased privileges to a country that has no respect for the rule of law".

..... normal relations for Taiwan

It is ironic that Mr. Clinton is pushing so hard for "normal" trade relations for China, while he is still isolating democratic Taiwan in the international community. If there is a rational for trade relations with Communist China, shouldn't there be a much stronger rational for normalizing relations with Taiwan?

As we have emphasized on these pages before (see "Normalize Taiwan Relations", Communiqué no. 88, pp. 1-2), Taiwan's isolation and the anachronistic "One China" policy are outdated left-overs from the Chinese Civil War and the Cold War, and have no place in the 21^st Century.

We thus suggest that Congress should link the PNTR vote to an agreement by the US Administration to grant permanent normal diplomatic relations to Taiwan.

There have been suggestions in Congress to tie the PNTR vote to a toning-down by China of its threats against Taiwan, or even to tie it to the Taiwan Security Enhancement Act passed overwhelmingly by the House in the beginning of February 2000, and now up for a vote in the Senate (see Report from Washington on pp. 21). Linking it to normalizing diplomatic relations with Taiwan would even be a much better, and forceful, signal.