Clinton Vows to Renew China Trade Privileges

WASHINGTON —  President Clinton announced Monday that he will renew China’s trading privileges with the United States, sending the volatile issue to Congress, where opposition to the annual decision is unusually intense because of such concerns as the Chinese human rights record, charges that the Asian giant has sought to influence U.S. politics, and its imminent role in governing Hong Kong.

Still, Clinton administration officials and most congressional leaders expect the White House to prevail in the clash over preserving China’s most-favored-nation trading status. All but a few nations have such status, which amounts to a normal trading relationship with the United States.

“I think we’re more likely to have a positive influence on China by engaging them than we are by trying to isolate them,” Clinton said in making his announcement. “I think it’s a simple judgment.”

Speaking later to an audience of business executives, Clinton elaborated on his decision, maintaining that--while the two powers have “differences” on human rights and other matters--growing economic ties are the best way to “secure our interests and our ideals.”

“I believe if we were to revoke normal trade status, it would cut off our contact with the Chinese people and undermine our influence with the Chinese government,” the president said.

“Our broad policy is engagement,” he added. “That doesn’t mean that we win every point, but it means we work together when we can and we’re honest in our disagreements when they exist.”

The president will notify Congress officially of his decision by June 3. To reverse it, the House and Senate must pass a joint resolution by Aug. 31. But even if Clinton’s opponents were to muster a simple majority of votes to pass such a resolution, the two-thirds total needed to override a certain presidential veto is widely viewed as out of reach.

The annual decision on trade with China has become increasingly controversial for U.S. presidents, particularly since the Chinese government’s brutal crackdown on student protests in 1989. This year, however, opposition has heated up sharply, fueled by an unusual coalition of Christian conservatives and human rights activists.

In arguing against normal trade with China, the opponents cite ongoing concerns about human rights violations, theft of U.S. intellectual property and fears that Beijing will trample democracy in Hong Kong when it takes over the British colony this summer.

“Today marks the high-water mark for the proponents of MFN, because now the formal debate begins,” said Gary Bauer, president of the Family Research Council and a leading voice among leaders of the Christian right who are pressing the case against China. “The more human rights violations and other problems are exposed, the more reluctant members of Congress will be to walk the plank one more time on this one.”

One such congressional representative is Rep. Nancy Pelosi, a liberal Bay Area Democrat who usually does not find herself on the same side of issues as Bauer but has emerged as a leading critic of China on the human rights issue.

“I’m disappointed that President Clinton has chosen to continue a failed policy,” Pelosi said.

Further complicating the debate for those siding with the administration’s China policy are recent revelations that the FBI is investigating reports that top Chinese officials approved a plan to illegally funnel campaign contributions to candidates during last year’s U.S. election campaign.

Sen. Mike DeWine (R-Ohio) cited this allegation--which the Chinese have denied--as one example that the prevailing U.S. policy “has had no effect” on Beijing’s behavior.

“We’re not only not making progress [with China], but we’re going backward,” DeWine said.

In the face of such criticism, advocates of renewing China’s trade privileges rushed to praise Clinton’s announcement. Sen. Dianne Feinstein (D-Calif.) hailed it as “good news.” The president’s decision, she said, “has removed all doubt about his commitment to maintain stable trade relations with the largest nation and third-largest economy on Earth.”

Administration officials, meanwhile, pointed to several arguments in favor of renewing China’s trade status, including a growing economic relationship between the two countries that Clinton said accounts for 170,000 U.S. jobs “and doubtless will support more in the years ahead.”

While opponents of MFN renewal complain that the economic links have done little to change China’s policies, the administration contends that withdrawing the “favored” status--which would put China in a category with such nations as Afghanistan, Cuba, Laos and North Korea--would reduce U.S. influence with the Chinese.

Speaking to reporters, Samuel R. “Sandy” Berger, the president’s national security advisor, pointed to U.S.-Chinese cooperation in such areas as limits on chemical weapons and peace on the Korean peninsula, even as he acknowledged differences on human rights, Chinese weapon sales and trade policies.

“We cannot dictate, we cannot determine China’s direction. But we can help influence China’s direction if we remain engaged with it,” he said.

If the trade status is withdrawn, Berger said, “we’re not going to isolate China. We’re going to isolate ourselves from China.”

The White House also maintains that the imminent transition of control over Hong Kong on July 1 further argues for preserving the trade ties, a view widely supported in Hong Kong.

“Undercutting the island’s economic footing at this moment would be a serious blow just at the time when Hong Kong needs to exert its strength and its autonomy,” Berger said.

Many believe that such arguments will ultimately prevail.

“The mood of those who follow the issue closely is that we’re probably headed on a collision course with China at the current rate but that the conflict is still several years off,” said a senior congressional staff member active in foreign policy matters. “There’s some worry about Hong Kong and human rights, but it’s not strong enough to overturn the overwhelming trade interests.”

“There are a lot of people who are very frustrated about China’s actions, but cutting off MFN is such a drastic step with such dramatic consequences that it’s not likely to happen,” added Ed Gressor, policy director for Sen. Max Baucus (D-Mont).

Times staff writer Edwin Chen contributed to this report.