Washington, Beijing turn focus on trade
Washington, Beijing turn focus on trade
By Andrew Browne
SYDNEY (Reuters): With Chinese President Jiang Zemin signaling a turnaround in troubled ties with the United States, the two sides are preparing a last-ditch effort to secure Beijing's entry to the World Trade Organization (WTO) this year.
A meeting between Jiang and U.S. President Bill Clinton in New Zealand on Saturday will give a top-level kick to the negotiations that were broken off by a furious Beijing in May after the U.S. bombing of China's Belgrade embassy.
But Clinton and Jiang are not likely to get involved in details, leaving that to senior aides attending the Asia-Pacific Economic Cooperation (APEC) forum in Auckland, and to lower-level negotiators and sectoral trade experts who will take over in the next few weeks.
Already the public maneuvering has begun.
Jiang insisted during a visit to Australia on Wednesday that the obstacle to China's entry to the WTO was the U.S. Congress, and the ball was now in the U.S. court.
U.S. trade officials are equally insistent the burden is on China to break the deadlock.
Jiang portrayed Beijing's WTO bid as a victim of a U.S. political process beyond the control of Clinton, who he described as "my good friend".
And he told reporters that having missed a good opportunity to wrap up a deal by accepting an offer made in April by Premier Zhu Rongji "the prospect of the WTO question will be to a large extent dependent on the American side".
Zhu dangled the prospect of unprecedented access in agriculture, telecommunications and services. But Clinton balked because it did not go far enough on banking and financial services, or offer adequate protection against surges in Chinese exports, including steel and textiles.
They are declaring their aim is not to claw back the concessions made by Zhu, but to use them as a starting point.
"That package has never been taken off the table, and we would expect to essentially pick up where we left off," said U.S. Trade Representative Charlene Barshefsky, speaking to reporters at the APEC meeting.
U.S. Commerce Secretary William Daley told Reuters in Auckland that to get a deal through Congress China would have to improve on the Zhu position.
If China refused "it would be very difficult to expect that deal would survive", he said.
U.S. trade officials, who embarrassed Zhu by publishing the full details of his offer, have previously suggested the Clinton administration would now accept them more or less unchanged.
But China disputes the published details, saying they are exaggerated. And it has rowed back on a key concession allowing foreign companies up to 50 percent ownership of Chinese telecommunications firms.
If anything, the mood in the Republican-controlled Congress is more anti-China now than in April when Zhu visited, aggravated by accusations of Chinese nuclear spying and anti-U.S. protests in Beijing that followed the bombing.
Sentiment is likely to sour further as the presidential election campaign heats up.
And while Jiang signaled on Wednesday that China was ready to move beyond the embassy bombing tragedy and patch up relations with the United States, key issues still divide the world's most powerful and its most populous nation.
Taiwan is the biggest potential flash-point, and Taiwan President Lee Teng-hui has lit a slow-burning fuse by declaring that the island will only deal with Beijing as sovereign equals on a "special state-to-state basis". China regards Taiwan as a renegade province.
For U.S. businesses frustrated by meager results obtained from mighty efforts in the China market, a WTO market-opening deal is crucial. Failure could lead to a further fall-off in foreign investment in China.
China arguably has most to lose if a deal cannot be patched together in the next few weeks in time for China to join before a new round of global trade talks begin in Seattle in November.
At stake is the reform of ailing state-owned enterprises, which are unlikely to be shaken into change without the threat of foreign competition.