BILL THAT WOULD HALT CHINA MFN HITS SNAG
Byline: Joyce Barrett
WASHINGTON — The House Ways and Means Committee gave a negative recommendation to a measure to withhold China’s most-favored-nation trade status, even as the panel agreed in a voice vote to advance the proposal to the House floor.
The bill is expected to be before the House by the end of July. It’s generally forecast that the measure will fail and China’s shipments into the U.S. will retain the same low tariffs levied on goods from almost all of the U.S.’s trading partners.
President Clinton notified Congress June 3 that he planned to extend China’s MFN for another year. This extension — required annually — does not need Congressional approval, but Congress can vote to reject it, and bills to do so have been brought up unsuccessfully since the Tiananmen Square massacre of 1989. This year, the usual objections to China’s MFN from human rights activists have been augmented by Capitol Hill criticism of the administration’s approval of sales of high technology to China. Rep. Gerald Solomon (R., N.Y.) introduced this year’s bill to deny MFN.
Arguing against denial of MFN, panel chairman Bill Archer (R., Tex.) said, “The best way to advance democratic values in China is to keep China open to the West and open to American ideals.”
Members of the trade panel voiced concerns about China’s repressive policies. But Archer said that under existing law, China’s trade benefits can be denied only if it’s found that China’s immigration policies are repressive. He challenged MFN opponents to draft legislation to broaden the conditions of MFN if they want to end China’s privileges.
The committee backed Clinton’s decision to extend limited U.S. government credit and investment guarantees to Vietnam, considered a precondition for MFN. This is expected to be approved by the House. And the House passed as part of an IRS reform package a plan that would change MFN to “normal trade relations.” This is an attempt to somewhat defuse the yearly objections to continuing China’s trade privileges.