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The Glue in US-China Relations

When the dust settles after this year's fight over renewing China's most-favored-nation (MFN) trading status, and when the United States presidential election is behind us, I will call on the next Congress and administration to seek consensus on a China policy that includes abandoning this yearly fight over MFN.

Congress should pave the way for granting permanent MFN status to China when it joins the World Trade Organization (WTO). I will introduce legislation in the Senate Finance Committee to accomplish just that.

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The US has serious concerns with China over its treatment of dissidents and Tibet, its harassment of Taiwan, its barriers to trade, and its involvement in weapons proliferation. But threatening each year to revoke MFN hasn't brought us closer to resolving these problems.

Since 1993, when the Clinton administration attempted to link MFN status to some of these issues, the situation has deteriorated. The reason: constant zigs and zags in its China policy.

I believe the president made the right decision to delink MFN. But from the flap over a visa for Taiwan President Lee Teng-hui to timidity in addressing proliferation violations, the US has shown an inability to make clear decisions based on America's long-term national interests; to engage our Asian allies in the decisionmaking process; and to deal honestly with the Chinese.

Extending MFN status permanently will simply put some constancy in our relationship. As some of my colleagues have begun mentioning the concept of permanent MFN status, other voices are heard pleading with Congress not to lose this "leverage."

What leverage? History shows that the annual fight over MFN has not prevented missile sales, freed dissidents, or protected Tibet's culture. And revoking MFN status will hurt the very people we would like to help - the reformers and residents of Hong Kong and Taiwan.

I believe that proposing permanent MFN status for China gives the US additional leverage in negotiations on two important issues: entry of the People's Republic of China and of Taiwan into the WTO.

US efforts to work with China on WTO entry would be greatly enhanced if the Jackson-Vanik provisions were removed. The WTO requires that the US grant China unconditional, permanent MFN trade status once it joins the WTO. But the Jackson-Vanik amendment to Section 402 of the Trade Act of 1974 prevents this, forcing us to work out a separate bilateral deal. This has been a major sticking point in our negotiations with the Chinese.

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Congress should make it clear to China that if it meets the economic criteria necessary for WTO membership, then Congress will grant President Clinton the authority to extend MFN permanently.

Congress and the administration must make it clear, however, that the US does not link Taiwan's entry into the WTO to the People's Republic of China's entry. When Taiwan meets the economic criteria for entry as the "Customs Territory of Taiwan, Penghu, Kinmen, and Matsu," or "Chinese Taipei," the US should support its entry immediately, even if China has not yet made the necessary concessions itself.

The Jackson-Vanik amendment was never intended to serve as a weapon of punishment for every problem we have with nonmarket economies. Its original purpose of guaranteeing freedom of immigration from the former Soviet Union has been grossly distorted without achieving any positive results. Let's get back to the original purpose of MFN to encourage normal trading relations by removing China from this artificial process.

*Frank Murkowski (R) is a United States senator from Alaska.

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