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To: peter a. pedroli who wrote (374)	6/1/1998 2:27:00 PM
From: peter a. pedroli	Respond to of 880

so here you have a very interesting twist,pakistan will be denied imf loans so they default on the loan now outstanding. billy can'nt get congress to fund imf or the world bank, china looses mfn their foreign reserves are such that if their good become more expensive and exports slow this could be the trigger that give chine impetus to devalue their currency.with the final asian tiger down for the count and the imf out of money the end of 98 could be a very tough time to make money in the stock market. starr has billy dead to rights and doj will have a report by the guy leaving in july or early aug. that is going to be scathing. i was around during watergate and the markets imploded.this will be a very hot summer. MFN debate set amid China controversy WASHINGTON - White House officials fear the latest controversy over U.S.-Chinese relations could spill over into another area: the upcoming debate in Congress about renewing most favored nation (MFN) trade status for China. Trade experts say President Clinton may face an embarrassing uphill fight or even a defeat on MFN because of the contentious climate created by the allegations that: China tried to buy influence through illegal U.S. campaign contributions. China gained high-tech secrets after Clinton allowed a U.S. company with strong Democratic ties - and already under investigation by the Justice Department - to use a Chinese rocket to launch a satellite. For the first time, Republican congressional leaders are saying they might vote against MFN for China. Exports from non-MFN nations are hit with higher tariffs than those levied on goods from most U.S. trading partners. Only six nations don't have MFN status: Afghanistan, Cuba, Laos, North Korea, Yugoslavia and Vietnam. A few others, notably Libya and Iraq, probably would join that list if the United States had trade relations with them. If China were to lose MFN, U.S. consumers would see higher prices on goods imported from China, such as toys, shoes and sporting goods. So those products would be less competitive in the U.S. market. Meanwhile, U.S. companies fear losing MFN would prompt China to close its growing markets as well. MFN status for China normally has drawn widespread support from the GOP, which has championed free trade. But Clinton will "face a very difficult situation in actually obtaining (MFN) renewal given the current campaign scandals and the election-year climate," said Edith Wilson, senior fellow for trade at the Progressive Policy Institute. Rep. David Dreier, R-Calif., and a dozen other GOP supporters of MFN warned Clinton in a letter sent last week that the current controversies could make this year's vote difficult. The annual battle over MFN renewal has never been easy for Clinton. Human rights activists and congressional protectionists traditionally band together to oppose MFN. But Clinton has always won, as has every other president who has asked for MFN for China. Clinton will make a formal request for renewal, most likely through a written statement, in the next few days. The deadline is Wednesday. Congress then has 60 days to vote before China's MFN status would lapse. During that time, aides hope Clinton will have a successful trip to China later this month and build momentum for MFN renewal. The White House MFN team, led by chief of staff Erskine Bowles, is expected to argue that revoking MFN could further destabilize an Asian region already racked by economic woes. "It appears what we have is a political dispute, and the president believes we ought to keep politics out of foreign policy and the conduct of foreign policy," Clinton spokesman Mike McCurry said. The Senate is not considered a problem by MFN proponents. But in the House, momentum is building for those who oppose MFN renewal. Many House Democrats, led by Minority Leader Richard Gephardt, D-Mo., oppose MFN because of alleged Chinese human rights abuses, such as prison labor camps and lack of religious freedom. Among key Republicans, House Speaker Newt Gingrich, R-Ga., supported MFN renewal last year, and aides said they didn't know if he would stick to that position. But House Majority Leader Dick Armey, R-Texas, indicates he may be joining the ranks of MFN opponents. Spokesman Horace Cooper said Armey wants answers from the White House on its China policies before he'll decide. Religious conservatives, who have long opposed MFN because of China's human rights abuses, plan a major push on the issue. Family Research Council President Gary Bauer plans a speech at the National Press Club Monday criticizing Clinton on several U.S.-China topics, including MFN. By Bill Nichols, USA TODAY