Thought this was an interesting perspective:
stratfor.com
1700 GMT, 990807 – Beijing Raises the Dead … Issue
Long Yongtu, China's chief negotiator in its bid for World Trade Organization (WTO) membership, told the Canton Yangcheng Wanbao daily that any decision to restart talks on China's entry to the WTO rests on a convincing explanation for NATO's bombing of the Chinese Embassy in Belgrade. "The ball is still in America's court," Long said. He continued, "We do not want a confrontation, but we will not abandon our principles to obtain other countries' agreement to our entry."
Only days ago, it appeared that the embassy issue was finally dead. According to a July 29 report in the Hong Kong Standard, Beijing had softened its position on the bombing, backing off of demands for a full investigation of the incident and the punishment of those responsible for the bombing. China sought only an apology for the incident – which the U.S. had already offered, and compensation for the families of the victims – which the U.S. has since agreed to provide [http://www.stratfor.com/asia/specialreports/special39.htm]. The price for letting the embassy issue die was U.S. pressure on Taiwan to rescind what was all but a declaration of independence. All evidence suggested the U.S. was willingly paying that price.
So what has changed? Two things, both of which featured prominently at the annual meeting of senior Chinese leaders in Beidaihe. First, despite pressure from the U.S., China, and the countries of Asia, Taiwan has not backed down from its call for recognition as an independent state. Every day that passes reinforces Taiwan's statement as recognition of a de facto reality. China's options are few and not without mutual pain. Economic sanctions on China's close trading partner would hurt at home, and a military response would turn international opinion against Beijing.
Second, the WTO bid has taken on greater importance since China's reformers were apparently given one last chance at Beidaihe. Prime Minister Zhu Rongji must deliver on his promises of economic growth through reform. At the same time, he will not be allowed to do further damage to China's social stability. With Beijing's worries over unemployment already exacerbated by the surprising extent of Falun Gong membership, Beijing simply cannot let further economic restructuring add still more pressure to Chinese society. Zhu must gain the benefits of WTO membership without the concessions demanded by the West. And so, the embassy issue is back on the table.
What is interesting is that China has so little to bargain with that it must revive this dead issue. Its other options – such as a military response to Taiwan or a devaluation of the yuan – are both on a significantly higher level of engagement and confrontation, and are not without pain to China itself.
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