I've been thinking some more about what I said in my last post and, tongue-in-cheek P.S.'s notwithstanding, I came across this fascinating commentary in my morning daily. I think that I have found America's next major enemy. What do you Americans think?
PETER COOK IN EUROPE
Playing the China card
Monday, March 17, 1997
By Peter Cook
THE stakes are immense. China, the world's largest recipient of investment after the United States, a world trading power that rivals Canada (its trade last year was valued at $280-billion (U.S.), ours at $350-billion), does what it presently does outside the purview of global trade and investing rules.
Those rules are run from a fortress-like building beside Lake Geneva, and it is to that building--formerly the headquarters of the GATT, now of the World Trade Organization(WTO)--that the Chinese have been applying for a decade for recognition and membership.
They lost face and got rejected three years ago when the GATT turned itself into the WTO. They face major problems over how their state-run economy could possibly adapt to free economic interchange. But, for all that, the Chinese are suddenly being taken seriously. A new urgency has gripped the question of Beijing's admission to the WTO.
The optimism has been fed by a new offer from Beijing. If it gets in, it now says that it will permit foreign companies to trade with anyone in China within three years and, while it insists that state monopolies will stay for items such as fuel and grain, it will make them abide by WTO fair-trading rules. It would also respect others' intellectual property; so, in theory, no more pirating. And it would give up insisting that it be treated as a developing country that needs to be allowed many years to make the transition to an open economy.
This breaks new ground. In the past China has either claimed it was owed membership because a successor government helped found the GATT, or tried to blame others for its failure to get in.
Officials in the WTO say great strides have been made; the Chinese finally seem to realize that they must conform and get rid of quotas and subsidies, investment preferences and other trade barriers, and it is up to them to come up with a coherent policy that would change the way their economy is run. On the other side, there is great receptiveness to having China in. It would transform a market that is closed off, or shared out by fiat and favour, into one of free and open competition. Given the potential, sales could take off.
But before the world revives 19th-century dreams of lighting the lamps of China, it has to pause and wonder about the present, and future, attitude of another mercurial power: the United States.
At present, there does not appear to be a problem. Or, at least, there did not a mere 10 days ago when the Chinese tabled their offer in Geneva. Fresh from an election victory, the Clinton administration had set out to "engage" China at a senior level; Secretary of State Madeleine Albright went to Beijing, Vice-President Al Gore was going there, a visit to Washington by Chinese President Jiang Zemin was planned for the fall. The engagement was on other fronts, nuclear proliferation, drugs, human rights, common policies toward Asia, and not just on trade. But it was in response to the positive approach on trade that Beijing did what it did in Geneva.
So do we finally have a meeting of minds, based on the U.S. desire to engage China, not its desire to contain (as with Cuba)?
The answer, regrettably, appears to be "No." In small and large ways, over the past 10 days and before, U.S. political opinion seems to have been gearing itself up to be critical of China, and even to think of Beijing as its primary long-term threat. Not only has the atmosphere been poisoned by revelations that the Chinese may have thrown money around during last year's money-mad U.S. election, but Washington has heard testimony that the record on human rights has gotten worse, that the Chinese military are a regional threat in Asia and that two-way trade now runs $40-billion in China's favour. To add to this stew of concern, a number of books and papers have come out (including The Coming Conflict with China, a book co-authored by Richard Bernstein and a former Beijing correspondent of this newspaper, Ross H. Munro) propounding the view that China is trouble, and that the way to deal with a society that lacks the rule of law is not through engagement.
At the least, all this suggests that the administration will bide its time. Ahead lie a series of obstacles; hearings into China's alleged interference in the U.S. election, the hand-over of Hong Kong, the decision whether to renew China's most-favoured-nation trade status. Only when each has been dealt with will the Clinton administration feel it can proceed in Geneva. And, even then, it may find itself on shifting sand. Two bills now being hatched in Congress would require the White House to report on whether China is keeping its promises in Hong Kong and give Congress the right to approve any China WTO membership.
On both sides, there are difficulties--which is why China has been kept waiting for so long. The Americans can legitimately say that they have signed deals on, for example, pirating of videos and software, yet the thefts go on; how would the WTO do any better? On the other side, the Chinese fear that anything resembling open competition would wipe out the inefficient, state-subsidized plants that comprise 50 per cent of the economy and are the last vestige of communism in their country. Strange, then, that the Americans should oppose them.
I personally plan to buy the book mentioned in the article, The Coming Conflict With China. Sino-American relations will be where it's at politically in my opinion for the next couple of decades.
Any other opinions? |
