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Case Number: 2008-0702-F
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MARKER
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Folder Title:
China [Folder 1] [4]
Staff Office-Individual:
Speechwriting-Oriulak, Paul
Origina~
4022
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�02/01/00
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hen, Mona K.
From:
Sent:
To:
Cc:
Subject:
Malinowski, Tomasz P. (SPCHW)
Tuesday, February 01, 2000 1:59 PM
@NSA - Natl Security Advisor
@SPEECH - NSC Speechwriters; @ASIA - Asian Affairs
china speech [UNCLASSIFIED]
For SRB:
Revised China speech, with your edits, plus additional suggestions fr()m Ken and Tom.
Shorter, but I still need to cut.
~L-
-Paul
f< Q__C:z\ ~ b
('Mq~
~rb·china"_.doc
l.
�02/01/00
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Orzulak
NATIONAL SECUIUTY ADVISOR SAMUEL R. BERGER
REMARKS TO
THE WOODROW WILSON CENTER
ON CHINA
WASHINGTON, D.C.
FEBRUARY 2, 2000
\
Speaking to the Wilson Center is always a challenging prospect. It brings to mind the story of
the man who lived through the famous Johnstown flood. All his life, this man would stop and
tell everybody he met the story of how he survived. When he died and went to heaven, he asked
St. Peter to convene a crowd so he could tell them about the great flood. St. Peter said, 'T d be
happy to. But you ha.ve to remember one thing- Noah will be in the audience."
There's more than one foreign policy Noah in this distinguished audience. Indeed, Lee Hamilton
himself comes with an entire Ark. For 20 years, he brought a steady hand to foreign policy in
Congress) with the emphasis always on patriotism) not partisanship. I thank him for that.
Last week in his State of the Union address, the President gave a compelling summary of the
challenges America will face in the 21st century world. Looking ahead, there's good reason for
optimism. America is enjoying the longest economic expansion in its history. Our military
strength is unchallenged. Our alliances are strong. Our values are ascendant. JEighty years after
Woodrow Wilson hoped that American leadership would help make the world :safe for
l)O;.r
democracy- more than half the world's peoplJ(ive under governments of their own choosing.
But as the President said last Thursday, this is not a world without dangers to us. ThePsis the.
~
i~e
FI'QEtJeet thet .2.._ur security
Tftere
..
-~threatened by regional conflicts that pose the risk of a wider war.
~
.~
Eirmger thatlhe march oftechnology ~give terrorists and hostile nations the means
to undennine our defenses, and force us to once again live in fear.
~ere
stability of the 21st Century ~e threatened by an ever-vndening gap
i_, a cllxam::C'11bl!t 1J1s
-
betwe€~n rich and poor.
�02/01/00
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2
And of course, there is the possibility tha~former adversaries Russia and China will fail to
emerge in this century ao stable, prosperous~emocrati~• eflloe Hft;te<l ~.
Today, I want to talk about China. Since President Nixon went to China. in 1972, the United
States has sought to develop a constructive relationship with Beijing, initially as a
counterweight to the Soviet Union and later
right. We haveE1o
~cogn'm o~':;~g importance in its own~
~en~ii China with an economy that is open to
American products, farmers, and businesses. A China whose people have access to ideas and
information. A China that upholds the rule of law at home and adheres to global rules on
everything from nuclear non-proliferation to human rights to trade.
This year, we have an unprecedented opportunity to advance those goals. The .opportunity, of
course, is China's entry into the World Trade
.)
rganization,
~ GliAl~""'"'
This will be an intense- and intensely important -debate. lleepl-e 01' betH: siele~F the B:i~le
~~
-Co
~egitimate concerns about China. ~let me take a few minutes today to -ralk about why
supporting this agreement- and permanent NTR for China-- is .not only in our economic interest,
but, more important, is in our national security interest.
.
~u..rl ~r U!~ 1L- ·?'A.M.Iwl~>
Every debate on a trade agreemen~~ a ~;ir~l~uest10n:
wtll our economy and our
workforce benefit from the terms we've negotiated, or will they suffer? From an economic
perspective, there is no denying that this agreement strongly benefits the United States.
�02/01/00
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For years, China has had extraordinary access to our markets, while its markets have been in
many ways closed to American products and services. Indeed, we ran a $71.5 billion trade
.
.
~OL~~ ~4f* C~J. .
.
\~~~
defictt wtth Chma last year-. our larges~ Thi' agreemertgeqwres Chma to ma.k~ •
concessions to open its market to America, ¢ a k e no
China.
~~opening ~io~
!!~.kcting this agreement would in no way limit China's access to our'ritarkets.'lt t"
f;t.:'\.rc_~CQV.. ~ a,v.A ~ ~ '()u_--- .......
wel.iW --~~ 8 t t r f t 8 : , efl~l1ring th~-El8 eleficit J"emaiP$ bigh.
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industrial products to computers and semiconductors. It tliirectly responds to concerns r~js§I!M•""
~
~
~~public6lnS and Deme~t!t ttii:lie about unfair trade practices in China- from product
~
L.ut......-
to technology transfers -
.
·
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~·
factories in China to sell products ther
~
~~~1·
, /rvr"' ~ That is what this agreement means in principle.
Here is what it means in practice.
Consider the auto industry. Right now, a car made in Dearborn faces an 80 to 100 percent
before it can be sold in China --which prices us 1'i8lt out of the market. So if you want to
cars in China, you need to base your operations in China: To do that, you must form a joint
ventllfe with a Chinese middle-man, a state run enterprise and give them at least a 51% stake.
You also must to transfer a huge amount of your technology to China, and teach the Chinese how
C~JtP4!\il~
to use it -- which means you are transferring both your product and your tfl\i:ait~o your eventual
·
·
·
~aJ..ao~~F
competitors.Q aga~:Bst-t-eaHl3 tQ 1m~ Amencan car parts1 so you h ave to work
~~~ C"l_) k-'-w:io~ J
with Chinese ~IJ\t'8-eet., co~ponen~~~, and train them how to make those, too.
In addition, Americans ~tl~directly run distribution centers in China, so once your
parts are made, the Chinc'3C have to '5ell iliem for you.
,
•
T~
-•or-,~~~~~~~
This agreement will dramatically reduce China's tariffs on everything from agricultural and
~
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I•
Al:rl.er1rsml;:
MP.
nnt l'lilmwed
to directlv own
�02/01/00
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4
service centers, either. So you have to find
ano~-man. And all tbis assumes that
Chinese consumers can buy the cars in the first place, because the only financing that is allowed
in China is through state-run banks - and they don't make loans for cars. L]ttle wonder that there
are many times more bicycles in China than automobiles.
Under the new agreement, it's completely different. Tariffs on American cars fall by nearly 75
percent, so we can compete in Chinese markets. The requirement that we have to link up with
'(\ 0
ti(" _ Chinese enterprises is eliminated.
~
So is the requirement that we have to transfer our,../--
~/~ technology. And, American manufacturers will now be free to use parts made in America for
f'-
assembly in China, to set up their own distribution centers, to run their own service shops, and to
provide their own financing to consumers.
From our perspective, it means that we're going to sell a lot more American cars in China, which
means more jobs in America. In return, the Chinese people end up with much better products at
lower prices. Take that example and multiply it out across all of our other industries- from
manufacturing to high-tech to insurance to agriculture - and you begin to get an ildea of~
~mteh thi~1ean to both our economies.
_
-
~8t~~=-dts~u=l:lired to do is~ grant China permanent normal trade relat1ons
status,. 't6 1-Jr:ifl:~ t;;hiRB iiHQ ~e WTQ. It's important to understand what that mea~t
~R-4s Bet fl: faoot to ClriiiB, it is 1Ae eest
way to
leH.tt:
playing fleld. AuJit'"bi
fl
rceipraeal
..a~ement (yes, Cllina lliU!t also gtant us PN'fR:). It simply means that we will give China the
same tariff schedule w~to Lost every other nation i~e world, and ~ will do
lik~::\e ~do tl?is, ~~ !:"al~ ~~e':e €hilli~ ~:;~.
t.~"4 t+e. b,._.f P1'f'ltt 'f> 44-1 rJ/U... WID ~ [d.]).
Otlf
�02/01/00
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5
China,
'
·
e. What it 'Will do is get us out of the cycle we are now in,{;;_
where the future of Chinese trade comes up for a vote every single year in Congress.
~
·
:;;~~no,
i1~et1lcl: deny
.otJih;
tAmeooEil'l:liiTnAIJIItt:.~~~~~~$;~~~~~~~st,~a:~c::~~ the spec':(~
~~~~~~~~--~--~~~re~pu~NK~a ~~
ffs as they stakeWt ;t
~. ~
~~/
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.
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~
na will write that future as it answers some fundamental questions: It has extended some
eedo~ut
~,
will it gain the resiliency and stability that can only come from respecting hum
4-~
rights and pemtitting opposing political voices to be heard -- and felt? It is reforming its
tiona~
-namely access to knowledge and unfettered thought? It has become deeply engage in the
.
~~
~~ ~~A
-~~~
international communi~but will it make '}tommitment to play by global rules an do its p~
to address global challenges like the spread of weapons of mass destruction atltd
~ te chan~
It is growing stronger; but will it use that strength to build a more secure Asia, or
eaten~
the freedom and security of its neighbors? Ultimately, the answers will come from China. But
we have an enormous stake in encouraging it to choose the path of integration and reform, not
. 1 .
ISO at10n,
~1 4~ ~cf.
.
. .
.
stagnation, and d ec1·
me. Andb nngmg Ch'ma mto t l1e WTO wiTl ~~
•
�.--------,-----------------------~-------------------
6
To understand why, we need t
~China
clearly, neithe through rose"'colored glasses or
through the glass darkly. We need to look its progress and its problems, its system an
strains, its policies and its perceptions of us, of itself, and the world.
more than 200 million people out of absolute poverty. One
markabl result is that China now [},.;.
~
has the largest wireless communications market iri the world, adding the equivalent of a Baby
!At
-----~
.
~~
ltHt
J
Bell to their telephone system every year.
But China faces daunting problems as well. Its working age
populatio~reasing mo~ ~
by
than 12 million people- equal to the population ofNew England- ev~ry year. Tens of millions
of peasants are migrating from the countryside, where they see no future; to the city, where only
some find work. China's political system has become plagued by corruption. Its air is so dirty
that 25 percent of all deaths in China over the age of five come from chronic respiratoty disease,
four times the rate of the United States. ~China's economic growth has slowed just when it
needs to be rising to create jobs for the
J51tk
A
'
~~d maintitin support for economic reform
cY
.
.
J16r all the progress of China's reforms, private enterprise still accounts for less than one-third of
n
tS
its GDP.
Chin~state banks ~1 making massive loans to struggling state firms, the sector of
the economy least likely to succeed.
-
-
e~c-
-
china's top leaders understand that ~change is both essential and risky. It is risky because
economic reform and opening China's antiquated economy to global competition is likely to
'
cause more short-term unemployment and the specter of social unrest. But, interestingly,
.Cbilla'•
lo.S..~o understand that it is essential because China cannot make the next leap in
=
eeeftemi€ deve?io
ment Without world-class industries an:d products that can compete in the ·
t) '&
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.tJ"re.- ~fl4 it h
. fl.t.
economy·/(
worf:: simply cannot
by mamtaining the
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-
f
~!ability
s~uo.
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.
.
-
.
What does this mean for us? As the President has
~j..~(]
s~f we've learned anything. in the 1ast few
1
years from Japan's long recession and Russia's current economic troubles, it is that the
p
weaknesses of great nations ~an se as big a challenge to America as their strengths:" So as we
~
'
f~cus
on ~he potential challen
future, let us not forget the
that a strong China could present to the United States in the
rislf~ak China , beset by internal conflicts, social dislocation
. ~k~b
.· . . . .
·..
..
~d cnmmal actlvity[large-sca e ~ em1gra!Io~ a 'lt.st zone of mstab1hty m Asia.
~
~-
-
Our interest lies in encouraging both stability and change in ·china by encouraging it to ineet, not
'
.:.. .• ~
'
.'
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eta~~
stifle, the growing demands of its people for op~enness, accountabilit~ . reform. Bringing
China into the WTO will help in
~ays.
·.
·
ate~
~~
~~.lWw1&4!1L.
.
~
. .
1\~tcmiwt Zh 1 R !!Ji md gt:ltet~form-minded leaaeFs ift CliifttJ. understand that lowering tariffs
and other barriers exposes China's state-run_ industries to competition; man)' will not be able to
compete without fundamental changes in ownership and management. But they also understand
I
,
'
that forcing firms to compete is something China must do to sustain its growth. With this WTO
agrrement, they have chosen to continue opening their economy, despite the risks that path
entails. Do we really want to reject
~hoice?
.
.
.
.
The introduction of competition results in natural pressure for progress. A decade ago, China's
best and brightest collt:ge graduates sought jobs in the government, in large state-owned firms or
.
'
state-run research institutions or universities. More and more, the best and brightestare'e!,h~
starting their own companies or choosing to work for foreign-invested companies -,. where they
::.J
�8
.
.
.
generally get higher pay, a better work environment, and a chance to get ahead based on merit,
not political connections.
Industry surveys show that U.S. companies are the leaders in the Chinese market in developing
.
cln'IWIAc
human resources -:- by emphasi~ing teamwork and respect for individual rights#ore an{t more,
Chinese firms are learning that unless they change their working style and treat employees with
. ~"11.~
respect, they will lose out in the ~"'for top talent. This process will only accelerate as
China joins the WTO, and we should do all we can to encourage i!J .lee~
.f k.iu
~
~~,L.1~ ~£m's:Pw.i1- .. ~~~~
Second, by accelerating economic change, the agreement we reached also has the potential to
China to evolve into a more o en and free societ .
In ways that are halting~ incomplete, but nonetheless real for millions of ordinary Chinese ~
.
=:1_~__
.
I
(1} ~_l~f ~
citizens, China's economic opening hasfkeady given its people greater scope to livt~s
\
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5! e
.
.
lk Take Shanghai, for example, the city that has been most open to international
influence. Ten years ago, it was illegal for people in China to own their own homes. Today, 25 ·
percent of Shanghai residents are homeowners. Ten years ago, there were no supermarkets, and
citizens had to buy food from state-run outlets using coupons. Today, there are more than 1,000
supermarkets and no more rationing of food. A decade ago, Chinese citizens could rarely travel
in or out of their own country. Last year, on New Year's Day, airlines added more than 250
flights to international destinations from Shanghai alone. Nationwide, China has seen the
emergence of more than 200,000 professional associations, consumer groups, tenant
organizations, environmental groups, plus an explosion of print and broadcast media, and local
elections in the vast majority or the country's 900,000 villages.
Let us understand very clearly: these developments do not mean ~hat the people of China enjoy
political freedom. Chinese authorities still tolerate no organized political dissent or opposition,
and no challenge - real or imagined - to the Communist Party. Over the past year, we have see
•
�9
;~,
an increase in its crackdown on political activities and dissen) iRsh:tding a harstt us
tt>
iillppJ:ess tae liah~R Goc.g; stepped-up controls on unregistered church~e suppression of
.
.
ethnic minority groups, especially Tibetans; the imprisonment of even more dissidents whose
only crime is free expression and free speech. And of course, just last week, Beijing announced
that the government was cracking down on the Internet.
..
ecause the Communist Party's
· .\.
. .
.~
ideology has largely been discredited in China, and because it lacks the legitimacy that can only
~-_,o
rfO
come from democratic choice, it seeks to maintain its grip by suppressing other voices.
So let me make very clear: This agreement is n<j a
~t i~
r
ts policy for the United States.
s:fty ~must·and will continue to speak ou on behalf of the people in China who are
persecuted for their political and religious beliefs. That is why we worked hard for the release of
Dickinson College librarian Song Ydngyi, who was releasedjust last week in Beijing. That's
why we sponsored a resoluti?n last year in the"UNHuman Rights Commission con~emning ·
China's human rights record last year and why we're doing it again this year. We will continue
to press China to respect global norms on non-proliferation; to encourage a peaceful resolution of
issues with Taiwan; to urge China to be.part.ofthe solution to the problem of global climate
change.
IJL4fUl1t~~~
.ctlH:s~ant flF8SSHF8 is rsttttirBJ\in all these areas .•
the
Wro will.surelylomplement~~hrts. --=~------\-~-/1.1~~ ~. ~, ·~
In the past, the Chinese state w~s every citizens employer, landlord,
t_~
~hopkeeper, and news ~
provider all rolled into one. By advancing privatization, this agreement will accelerate
.
.
a~
~~
~iu[.
that is removing government from vast areas of people's lives.
AI~-~-- / ~t
"r-LLfki,
By giving investors and property owners predictability and protection against arbitrary
government action,
it~nfsJ:"re8s
ta8 idea tb.at ic.dividuah; b,:;vre rights
4 tt
Already, HH:aer the
..Gb:inese legal system, betweet~ 36,666 and 40,000 citiz¢ns bring suit agaimt th8 ggven:n:J.lent
#(
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will give added impetus to those trying to strengthen the
Chinese legal system in a way that allows citizens to hold their government truly accountable.
Finally, by opening China's telecommunications market to
~t~~ology and~
firms, the WTO agreement will help bring the information revolution to cities and towns across
China. A year ago, China had two million Internet users. Today, it has nine million. Soon,.
.
.
.,
.
.
~
.
people in some of the most remote villages in interior China will have access to CNN. And as
.
~~
.
.
they become more mobile, more prosperous, and more aware of alternative ways of life,,{hey will
seek a stronger voic'e in shaping th~i~ destiny.
. .
.
~ h'{ k ~lvtct'Alfieft ystt ikink aQQwt it, it ilil outrageom; that the Chinese authorities.A'"e eraekiLlg QQV.~ en the
.
Bu'J-
~
4e t:Mtile. lft.""tTiis information.~~5.c:acking down on the Internet is like~
~ ~ t!/1
t/b -oh.U- ~ ~14 . ~~ ;4w.Jh'"Z4.
Internet. -Bl:lt it'liil
~Jelle ts a wm~~d, tn.e· fact tkai tee Chitie~e go vernme~iH:g eaek agaiasi ihe
·iAo~..ingQ~s~*~~~t:z:~·~t~~ ~ ~
l:lB€hn:going an~ Feel ami ele~eni
to the stafu6 fJ:MO.
Thi~~e~s
argume~t for slowing down the effort to bring China into the world;
not an
it's an. argument for
~
~
accelerating it.
best to the global economy discover that people are far more willing to tolerate wrenching
economic chan;;e when they have a say in the decisions that affect their lives. Compare the fates
~~~~c.
~e...
of the go rnments oytndonesia an~outh Korear_they.faced the Asian financial crisis.
Bringi
.
China into the WTO doesn't guarantee it
ill make the right choice for political reform.
~··
�11
But by accelerating the process of economic change, it will force China to confront that choice
.
.
sooner, and make the ir:nperative for that choice far inore powerful. .
'
·~
This agreement will advance our national security interests in a third way as well: it increases
the chance that in the new century China will be on the inside of the international system,
playing by the rules, instead. of on the outside, denying them ..
.
.
Under the terms of this agreement, the Chinese goveinment is obliged to publish laws and
.
(') If
regulation(~subjects some of its most important decisions, for the first. time, to the review of .
an international body. Why does that matter?
Quite simply, it applies to China the basic principle at the heart of the concept of the rule of law:
that governments cannot behave arbitrarily at home or abroad, that their actions are subject to
l .. "l'''""'"""d ¥"""'•""
AJUJ._A,1Ub~~~ 1 tk~.~ ~t..~~
/ ooolltst
oliC!l, Mid more likely to accept t
ito
norms Kt~~n tts n~tee: ae:u Hl*Han ftgms.
Mf ~Jtu 66 p.'
. .. . .
I know some d.. say that if China is allowed to j~in the WTO, it ·w~ually undermine our
effort to ;trengthen global norms' in two very important areas: labor rights and the environment.
.
.
~
fJtL
.
But the fact is, lnos}'fembers of the WTO
~q
~?J,u_
..·
aiTt... d~veloping countries, aHa
~
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~e
.,
~'k~~~~.~~m:,b~G":t,~,
change that equation. And considering the fact that China is home to one-fifth of the world's
workers and the source of a rising share of global greenhouse gas ~missions, it is hard to imagine
an effective global effort to
me~~thout China.§ingto enforce labor and
environmental standards in an international system that does not inClude China would be like
.
.
.
..
A. _ .
-~~
trying the defend against the LA Lakers, but leaving Shaquille O'Neal unguarded. He's the one~. I!.J,.
.
that has the' potential to do the greatest dama:3
.
. .
.
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It's fair to ask: how do we know China
will do what it promised to do in the agreement we
.
.
~A/ILl~ ~ ~C{ ~
/h1il
signed? Of course, we cannot know for sure. But we aobave ~sOilS tobeheve that it wil".
..
First, China is pledging to open its economy and its markets not just as a means of getting in the
WTO, but because most of its leaders believe reform is in China's interest: I t.iBe it eH:e~ttHt~ing
tha.t..in receetffieAth.!! the Chjnese h~pre askee fer 8lif ea:Yiee
aHa teebl'l:ieel ttssi~tanee to better
l.HlderstaR-9 an9 livs ~ to th.e tell+ls gf th.e \VTO agreemeg,t,
.
Second, as a member ofthe
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.
t:s
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thttt
ttdjadication.
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WTO~iR:asHerait eisp~s t~
.
.
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.
Cfl:wm vi~ltttes its kaes respeBsieilities und~r the WTOj)\will conft-ont judgments b~cked by a
13.5-member body, rather than being able to chalk up friction to supposed U.S. bullying. Right
now, if China treats our products unfairly, we h~ve no recourse, short of pulling the plug on
trade. This agreement increases our leverage with China in the event of a futu:e ~e dispute.o@m
~ ~ dotd
!l ~~~A.~~ hy fl.tL "~~Y~
e~y el:tlHpiH~.
~e
e'\1 ery tfl:iHg ffeftl i~
.te
An21t gives
greater leverage to insist that China move in the right
.
.
.
.
1
~
rection.
~
v:;
Chi%'
~
fortes of reform within
.
. ~~
4
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A-DJh~
How will China change? I believe it will be a combination of ~nternal pressures fo greater voic];_1'~rf
and external validation of the human rights struggle by the international communi y. The WTO ~ ,~
to~~~ wiillmaintain our leadership rol ·
L~r
Our policy should no more be measured week to week or year to year than you cou
agreement will cotitribute
.
Ltd.J
.
measured our policy toward the Soviet Union - with which we continued to engage, even t
it posed a much greater threat to us than China does today.
In other words, we must and will continue to protect our interests with firmness and candor.
. we must do so without isolating China from the global
for~~ its people to b
ild
~
~
~
a~
better future. That would leave the Chinese people with less ;:tccess to information, less co act
with the democratic world, and more resistance froin their government to outside influence and
!
�13
ideas. No one could possibly benefit from that except for the most rigid; anti-democratic
elements in China itself. Let's not give them a viCtory by 'locking China out of the WTCJ ·tW:'t fu
· wnl~. ~
["fiJ:
The question is not whether or not this trade agreement by itself will cure serious and disturbing firo
I
.
I}Uto/t
issues of economic and political freedom in China; the .issue is whether it will push things in the
right direction. President Clinton believes it will. Some of the most courageous proponents of
change in China agree. Martin Lee, leader of Hong Kong's Democratic party, SHpperts tli.i8
-ttgt~Je
says that without entry to the WTO; "any hope for the E£litical and reform process
.
LPro~t· · - ..J
would also recede. And Chinese dissident R~n Wandin~/Caid upon the deal's. completion:
"Before, the sky was bla~k. now it is light. This can be a new beginning."
It is our shared conviction that supporti~this a~reement is a new beginni~g} It is the right thing
.
·
A--,1 ~ ~ ~ h. ~Dl/l'd •
for America, <tftd tfte riget tftiHg fef Chi='~t will move Chin'a toward
·
~d t6
0
bttild tee ~st three
dee~
a more open, prosperous, a
(J:!;/ Let us hav~ the ~isdom to choose wisely. Thank you'..
·
.
~
eventually democratic
-a
�2/1/00 9:00p.m.
Orzulak
NATIONAL SECURITY ADVISOR SAMUEL R. BERGER
REMARKS TO
THE WOODROW WILSON CENTER
ON CHINA
WASHINGTON,D.C.
FEBRUARY 2, 2000
Speaking to the Wilson Center is always a challenging prospect. It brings to mind the story of
the man who lived through the famous Johnstown flood. All his life, this man would sis!!' ttM~---.
tell everybody he met the story of how he survived. When he died and went to heaven, he asked
.
St. Peter to convene a crowd so he could tell them about the great flood. St. Peter said, ''I'd be
happy to. But y,ou have to remember one thing-- Noah will be in the audience."
h·~t~~'sd~t{_
au Ience.
c:
.
Th ere ' s more t h an one 10reign po 1·Icy Noah"m t IS
.
.
~
Ind ee d , ·L ee H ami·1 ton
.
himself comes with an entire Ark. For 20 years, "brought a steady hand to foreign policy in
Congress, with the emphasis always on patriotism, not partisanship. I thank him for that.
Last week in his State of the Union Address, the President gave a compelling summary of the .
challenges America will face in the 21st Century. Looking ahead, there's good reason for
~~ ~CA.-~
OU/\optimism. Aw.eri~a is eujeyiA~he longest economic expansion in"'-history. Our military
.
(/k.. "1lu..
w d"lid.. .
strength is unchallenged. Our alliances are strong. Our values are ascendan}\ Eighty years after
Woodrow Wilson hoped American leadership would help make the world safe for
democra~
~Mt-~1~~.)
~ore t!ian half the world's people ~r governments of their own choosing
But as the President said, this is not a world without dangers to us. Our security can be
threatened by regional conflicts that pose the risk of a wider war. The march of technology can
give terrorists and hostile nations the means to undermine our defenses, and force us to once
again live in fear. The stability of the 21st Century can be threatened by an ever-widening gap
�2
between rich aJ?.d poor. And of course, there is the possibility that our former adversaries Russia
and China will fail to emerge in this century stable, prosperous, and democratic.
Today, I want to talk about Chin.L Since President Nixon went to China in 1972, the United
States has sought to develop a constructive relationship with Beijing, initially as a
counterweight to the Soviet Union and later in recognition of China's growing importance in its
own right. We have worked for the emergence of a China with an economy that is open to
American products, farmers, and businesses. A China whose people have access to ideas and
information. A China that upholds the rule of law at home and adheres to global rules on
everything from nuclear non-proliferation to human rights to trade.
rs
This year, we have an unprecedented opportunity to advance those goals. · The
opportunity~
China's entry into the World Trade Organization.
But before America can realize the full market~opening benefits of Chinese entry into the WTO,
Congress must answer a simRle question: will it grant China permanent Normal Trade Relations
0
/.w~~fi•'!:t\uissnnee<c~sSiairryVf<to guarantee the full benefits of the agreement we negotiated
WTO? Or will Congress tum its back on the ~ping changes China has agreed to make ('""- Ll--_.
~
and risk losing ground on the issues we all care about?
This will be ClJl-·intense an · portant de
/
me take ~few minut
for
1
AJ~
c9l~a -- is
today to ta
about why suppo , ·ng this agree ent
only in_9Jlfeconomic
tNTR
inter~r nati
Every debate on trade must first answer the threshold question: .will our economy and our
workforce benefit from the terms we've negotiated, or will they suffer? From an economic
perspective, there is no denying that this agreement strongly benefits the United States.
�~o-~/
.
For years, China has had ~ess to our markets, while its markets have been in
many ways closed to American products and services. Indeed, we
with China last
c
y~ largest with any country.
/,Uitk-/l~
!'ho apin~~ssions
This agreement requires China to make
~':(J/
.
to open its mark~ ;'
il,
maintain the market access policies we already apply to·
Denying China PNTR would
ra~~cit
while we have ~ agree~~
·
·
}:im~;l~i~~erican
ODltto.IJ
•
~rable market access ~tive ••••-•Rtlk•o•glt W¥~pute settleme~
that our European, Japanese, nd other
~~
competito~ve.
This agreement will dramatically reduce China's tariffs on everything from agricultural and
industrial products to computers and semiconductors. It directly responds to concerns about
unfair trade practices in
Chi~m1opfiro)(fiurcc:rdittRwi~-te-tetjfl'loli5'g;ITJ'ID'im~,n[n.d~¥e:s-rrs
prot.ections agamst-tmpm t surges from China that we filiai\vree:p~iliii~l!i!ft.J[lQ...utl~.wtU
~o:t
.
it allows our businesses to export to China fro~ome, and have their own
rather than being forced to set up factories in China to sell products through Chinese control.
That is what this agreement means in principle. Here is what it means in practice.
Consider the auto industry. Right how, a car made in Dearborn faces an 80 to I 00 percent tariff
before it can be sold in China --which prices us out of the market. If you want to sell cars in
=;
=
China, you need to base your operations in China. To do that, you must form a joint venture
with a c:!inese
transfer
~
S
h~
"6-flce- ~'
'% ~te ~n enterprise and give t~at least 51o/A You als~m~sl
c..t-
arnoun~ your technOlogy to China, and teach the Chinese how to use it-- ~{?_)
which means you are transferring both your product and expertise to your eventual competitors.
And because of local content requirements, most parts have to be made in China, too.
In addition, Americans cannot now directly run parts distribution centers in China, so once your
parts are made, Chinese partners have to sell.them for you. Americans are not allowed to
�4
directiy own service centers, either. And all this assumes that Chinese consume,rs can buy the
cars in the first place, because the only financing that is allowed in China is through state-run .
ban~they don't make loans for cars.
Little wonder that there are many times more
· bicycles in China than automobiles.
W'l1.2..
Under the new agreement, it's completely different. Tariffs on American carxall by nearly 75
percent, so we can compete in Chinese markets. The requirement that we have to link up with
Chinese enterprises is eliminated. So is the requirement that we have to transfer our technology.
And, American manufacturers will now be free to use parts made in America for assembly in
China, to set up their own distribution centers, to run their own service shops, and to provide
their own financing to consumers.
From our perspective, it means that we're going to sell a lot more American cars in China, which
means more jobs in America. In return, the Chinese people end up with much better products at
lower prices. Take that example and multiply it ~oss all of our other
industries~from
-..;..
manufacturing to high-tech to insurance to agriculture/\ and you begin to get an idea of what this
agreement could mean to both our economies.
For our part, we must grant China permanent normal trade reiations status. It's important to
understand what that means: it simply means that we will give China the same tariff schedule we
apply to most eyery other nation in the world, and China will do likewise. It would eliminate
the annual vote on China MFN, which we do not apply to any other WTO member. Some have
said we need the annual vote to address other concerns we have with China, on human rights,
proliferation, or religious
freedom~'?e,= cflways has the authority to address any part of our
~/~ ac/.ura.gf. GHr re1at&GA:S a· m&ttA:a or any
·
·a c;;;a·
gr part
· h.
·th
·
re1at10~w1 any nation, a:s1/Vl
Vt'~
aa~t
1p
confttryI\ tpe annual MFN vote has trot been an effective
instrument.~~ly affirmed our
trading relationship with China for ten years in a row. iB '"""Y ma~eo~~
.tariff£, became it Aas i!HCb a clram.atie efteet 8ft HS
~s mel!
h
gt~r
as
tbe~R,
makes it aR iseffeetive
�.(2- rv Lf
5
W"AIMI.~ ~ ~ r/v;
rett~}.
- ~~·t:IYJd Wl~ ~
What · will do is get us out of the cycle we are now in, where the future of Chinese
trade comes up for
~"/te~ ~ #f;~e~~ k-
The economic benefits of this deal to America are clear.&Congress votes no, we risk losing the
full, enforceable market access benefits of the agreement, as well as the special protections we
·~
negotiated. '"A.,a global economy, where global markets are essential, American businesses and
~~fth of the
workers would be put at an enormous disadvantage, essentially
.
world. It would be a self-inflicted wound that would hurt the economic health of Am eric]
~J..+c-4'~
.
Fzm;Athe econ~mic benefits are only the beginning of the argument, not the end. For I am
convinced
tha~ ~national security as it is to our economic security .
.tJL~
~,.~·~~~I'M...
Our nation has a tremendous stake in how China evolves.
As
ur
ture
IS
tle to
ia.~t;:;ti lity of Asia }~conomi call;, politically and mi Iitaril y;i;; inextri cab Iy entwine
with the stability and direction of China. As China develops, the path it illuminates or the
shadow it casts will be felt ~rom its own borders.·
China will write that future as it answers some fundamental questions: It has extended some
freedoms --but will it gain the stability that can only come from respecting human rights and
permitting opposing political
voi~es to be heard ;:;;d felt? It is reforming its economy:_ but
will it unleash the necessary ingredient of sustained groWth in the information age- namely
b£#~
accetxo kfioWfedge and unfettered thought? It has become deeply engaged in the international
community -- but will it make a broad commitment to play by global rules and do its part to
address global challenges like the spread of weapons of mass destruction and climate change? It
is growing stronger -- but will it use that strength to build a more secure Asia, or to threaten the
freedom and security of its neighbors? Ultimately, the answers will come from China. But we
have a enormous stake in encouraging it to choose the path of integration and reform, not
confrontation and decline. And bringing China into the WTO will
make~terence
�6.
To understand why, we need to have a clear-eyed view of
Chi~~er looking through
rose-colored glasses or through the glass darkly. We need to
loo~~rogress and its
problems, its system and its strains, its policies and its perceptions of us, of itself, and the world.
In the last 20 years, China has made remarkable progress in building a new economy, lifting
more than 200 million peopl,e out of absolute pove~~credible result is that ~~
has the largest wireless communications network in
to one
e
a, and is linking so many
rs .
anothe~adding the equivalent of a new Baby Bell every year.
--
But China faces daunting problems as well. Its working age population is increasing by more
---
than 12 million peoplef equal to the population ofNew England/\ every year. Tens of millions
of peasants are migrating from the countryside, where they see no future, to the city, where only
some find work. China's political system has become plagued by corruption. Its air is so dirty
that 25 percent of all 'deaths in China over the age of five come from chronic respiratory disease,
four times the rate of the United States. And China's economic growth has slowed just when it
needs to be rising to create jobs for the unemployed and maintain support for economic reform.
For all the progress of China's reforms, private enterprise sti~l accounts for less than one-third of
its GDP. China's state banks still are making massive loans to struggling state firms, the sector
of the economy least likely to succeed.
fr
9~~
l5hina's top leaders understand that economic change is both essential and risky. 'Rtey
7\ risky
because opening China's antiquated economy to global competition is likely to cause more
short-term unemployment and the specter of social unrest. But, interestingly, they also
understand that this change is essential because China cannot make the next leap in development
without world-class industries and products that can compete in the global economy. And the
�-------------------------------------
7
only way to produce competitive industries is to open the country to outside competition. ln
other words, China simply cannot ensure stability by maintaining the status
quo.~
What does this mean for us? As the President said when Premier Zhu Rongji visited Washington
last year, "if we've learned anything in the last few years from Japan'·s long recession and
Russia's current economic troubles, it is that the weaknesses of great nations can pose as big a
challenge to America as their strengths." So as we focus on the potential challenges that a strong
China could present to the United States in the future, let us not forget the risks that could be
posed by a weak China, beset by internal conflicts, social dislocation, criminal activity, and
large-scale illegal emigration -- a vast zone ofinstability in Asia.
Our interest lies in encouraging both stability
~change
in China by encouraging it to meet, not
stifle, the growing demands of its people for openness, accountability, freedom and reform.
.
~R<-
Bringing China into the WTO will help in each wap
tioJ?
First, this is not just an agreement to expand trade between our two countries. It will obligate
<.......0"-"'
f
/
ete is sometniif.g-cffinJt_nil!it~tai~With this WTO agreement, they
have chosen to continue opening their economy, despite the risks that path entails. Do we really
want to reject that choice?
The introduction of competition results in natural pressure for progress. A decade ago, China's
best and brightest college graduates sought jobs in the government, in large state-owned firms or
�8
state-run research institutions or universities. More and more, the best and brightest i'either are
starting their own companies or choosing to work for foreign-invested companies -- where they
generally get higher pay, a better work environment, and a chance to get ahead based on merit,
not political connections.
~dJ'"~mtrs, BMP¥'eys sk8w tkat U.S. companies are the leaders in the Chinese market in developing
human resources --by emphasizing teamwork and respect for individual rights. In tum, more
and more, Chinese firms are learning that unless they change their working style and treat
employees with respect, they will lose out in the competition for top talent. This process will
only accelerate as China joins the WTO, and we should do all we can to encourage it, because it
will lift the standards of Chinese workers
ft. and their expectations.
Second, by accelerating economic change, the agreement we reached also has the potential to
encourage China to evolve into a more open and free society.
In ways that are halting, incomplete, but nonetheless real for millions of ordinary Chinese
citizens, China's economic opening already has given its people greater scope to live their lives.
.
I
.
Take Shanghai, for example, the city that has been most open to international influence. Ten
years ago, it was illegal for people in China to own their own homes. Today, 25 percent of
Shanghai residents are homeowners. Ten years ago, there were no supermarkets, and citizens
had to buy food from state-run outlets using coupons. Today, there are more than 1,000
supermarkets and no more rationing of food. A decade ago, Chinese citizens.could rarely travel
in or out of their own country. Last year, on New Year's Day, airlines added more than 250
flights to international destinations from Shanghai alone. Nationwide, China has seen the
emergence of more than 200,000 professional associations, consumer groups, tenant
I
organizations, environmental groups; a 2,500 percent explosion of print and broadcast media
over the past 25 years; and local elections in the vast majority of the country's 900,000 villages.
�9
political freedom. Chines authorities still tolerate no organized political dissent. or opposition,
and no challenge to the C mmunist Party. Over the past year, we have see an increase in its
crackdown on political a tivities and dissent; stepped-up controls on unregistered churches; the
suppression of ethnic
nority groups, especially Tibetans; and the imprisonment of even more
dissidents whose only
ime is free expression and free speech. Because the Communist Party's
ideology has largely h n discredited in China, and because it lacks the legitimacy that can only
come from democratic choice, it seeks to maintain its grip by suppressing other voices:
.
.
is agieement 1s not,
~
bj=i:ts~illfrights policy fm the United
·-L
~
)
.
Ill continue to speak out on behalf of the people in China who are
persecuted for their political and religious beliefs. That is why we worked hard for the release of
Dickinson
Colle~e librarian Song Yon[{':~ ;;.;;.J/ased just last week.
That's why we
sponsored a resolution last year in the UN Human Rights Commission condemning China's
.
I
human rights record and why we're doing it again this year. We will continue to press China to
respect global norms on non-proliferation; to encourage a peaceful resolution of issues with
Taiwan; to urge China to be part of the solution to the problem of global climate change.
We must continue to work in all these areas.
,.
�10
By giving investors and property owners predictability and protection against arbitrary
government action, it reinforces the idea that individuals have rights. This will give added
impetus to those trying to strengthen the Chinese legal system in a way that allows citizens to
hold their government truly accountable.
Finally, by opening China's telecommunications market to cutting-edge American technology
and international firms, the WTO agreement will help bring the information revolution to cities
and towns across China. A year ago, China had two million Internet users. Today, it has nine
million. Soon, people in some of the most remote villages in interior China will have access to
CNN. And as they become more mobile, more prosperous, and more a\Yare of alternative ways
of life, I believe they will seek a stronger voice in shaping their destiny.
Of course, just last week, Beijing announced that it was cracking down on the Internet.
~
you +bisls du 1t:iot,]'s outrageous-- but it's also futile. In this information age, cracking down
on the Internet is like
1"T~)isg tQ Rail Jell@ !@ 11
1!!
[u like King Canute trying to still the water;r-
Indeed, the fact that the Chinese government is pushing back against the increasing flow of
information to the Chinese people only proves that the changes China is undergoing are real and
deeply threatening to the status quo. This kind of repression is not an argument for slowing
down the effort to bring China into the world; it's an argument for accelerating it.
In the end, GR.iH:8S@ 18aaets must come to understandJ;; China opens to the information
economy, it can succeed only as it liberates the minds
of~le and empowers the
individual. In this age, you cannot expect people to be creative economically and frozen
politically. Nations tltat
¥Htg
&Yooess in th<o global economy " " " - creative thinking
It~ tAle !h~ns that adjust best to the glo~ol ewnomy discover that people are far
more willing to tolerate wrenching economic change when they have a say in the decisions that
;;- ~
~
(}
�..
~-
·-
-~·
•Tn•"""", Mona K.
From:
Sent:
To:
Subject:
Orzulak, Paul K. (SPCHW)
Wednesday, February 02, 2000 9:55AM
@NSA- Natl Security Advisor; @SPEECH - NSC Speechwriters; @PRESS - Public Affairs;
@ASIA- Asian Affairs
.
Latest SRB China remarks [UNCLASSIFIED]
For SRB:
The latest draft, with your changes, and additional changes from Malinowski and
Lieberthal. Cut by two-thirds of a page. Reference to trade deficit deleted.
One last plea: I'm not sure that even King Canute could nail jello to a wall, but leaving
that line in may make the second half of the speech more colorful. The same goes for
the Shaquille O'Neal line we took out last night. Thanks.
_.
t;
t\dl}
cJ,,,_rj
e~lna7.20~.2x.dDC
1
TOO
iEJ
VSNdV
XV .::I LC: TT G3A\
00/60/ZO
�2/2/00 10:00 p.m. Orzulak
NATIONAL SECURITY ADVISOR SAMUEL R. BERGER
REMARKS TO
THE WOODROW WILSON CENTER
ON CHINA
WASIDNGTON, D.C.
FEBRUARY 2, 2000
Speaking to the '~ilson Center is always a challenging prospect. It brings to mind the story of
the man who live:d through the famous Johnsto'Wll flood. All his life, this man would tell
everybody he met the story of how he survived. When he died and went to heaven, he asked St.
Peter to convene a crowd so he could tell them about the great flood. St. Peter said, "I'd be
. happy to. But you have. to remember one thing-- Noah will be in the audience."
There's more than one foreign poiicy Noah in this distinguished aLtdience. Indeed, Lee Hamilton
himself comes with an entire Ark. For more than 30 years, Lee brought a steady hand to foreign
'
policy in Congress, with the emphasis always on patriotism, not partfsanship. I thank him for
that.~
Last week in his State of the Union Address, the President gave a compelling suinmary of the
challenges America will face in the 21st Century. Looking ahead, there's good reason for
optimism. This month, America marks the longest economic expansion. jn, our history. Our
military strength is unchallenged. Our alliances are strong. Our values are ascendant in the
world. Eighty yt~ars after Woodrow Wilson hoped American leadership would help make the
world safe for dt:mocracy, for the ftrst time ever, more than half the world's people now live
under governments of their own choosing.
But as the Presidlent said, this is not a world without dangers to us. Our security can be
threatened by regional conflicts that pose the risk of a wider war. The march of technology can
give terrorists arJld hostile nations the means to undermine our defenses, and force us to once
,,
600~
VSNdV
XV.:I LC: TT G3A\
00/60/60
�2
again live in fear. The stability ofthe 21st Century can be threatened by an ever-widening gap
between rich and poor.. And of course, there is the possibility that our former adversaries Russia
and China will fail to emerge in this century stable, prosperous, and democratic.
Today, I want to talk about China. Since President Nixon went to China. in 1972, the Un1ted
States has sought to develop a constructive relationship with Beijing, initially as a
counterweight to the Soviet Union and later in recognition of China's growing importance in i~
"k
]
<..... ~~·~ il> ~ ... +1;...' " c - - .
own right. We have worked for the emergence of a Cliiill:fi an econoYtat
IS
open to
American products, farmers, and businesses. A China whose people have access to ideas and
information.)
~~t upholds the rule of law at home and adheres to global rules on
everything from nuclear non-proliferation to human rights to trade.
This year, we have! an unprecedented opporrunity to advance those goals. The opportunity is
China's entry into the World Trade Organization.
Congress must answer a simple question: will it gr t China permanent Normal Trade Relations
I
status, which is the same arrangement we have give to 132 of the other 134 countries in the
WT0?6) Doing so is necessary to guarantee the ful
enefits of the agreement we negotiated
with China. Or will Congress turn its baclc on the sweeping changes China has agreed to inake
and risk losing ground on the issues we all care about?
Every debate on tmde must first answer the threshold question: vvill our economy and our
workforce benefit from the terms we've negotiated, or will they suffer? From an economic
perspective, there is no denying that this agreement strongly benefits the United States.
For years, China has had open access to our markets, while its markets have been in many ways
closed to American products and services. This agreement requires China to make wide-ranging
COOIEJ
VSNdV
XV.:I LC: 11 a3A\
00/60/60
�3
new concessions to open its market, while we have agreed only to maintain the market access
policies we already apply to China. Denying China PNTR simply would deprive American
companies and wo:rkers of the full benefits of China's concessions- the favorable market access
and ~ute settlement that our European, Japanese, and other competitors will have.
This agreement wl.ll dramatically reduce China's tariffs on everything from agricultural
and
industrial products to computers and semiconductors. It directly responds to concerns about
unfair trade practi<~es in China and allows our businesses to export to China from here at home,
and have their own distribution network in China, rather than being forced to set up factories
there to sell products through Chinese partners.
That is what this agreement means in principle. Here is what it means in practice.
Consider the auto industry. Right now, a car made in Dearborn faces an 80 to 100 percent tariff
befor~ it can be sc1ld in China --which prices us out of the market. If you want to sell cars in
China, you need t•D base your operations in China. To do that, you must form a joint venture
with a Chinese
st~~ ente~rise and give it at least a 51% stake.
You also must agree to
transfer a signific;ant amount of your technology to China, and teach the Chinese how to use it -which means you are transferring both your product and expertise to your eventual competitors.
And because oflc1cal content requirements;most parts have to be made in China, too.
In addition, Americans cannot now directly run parts distribution centers in China, so once your
parts are made, Chinese partners have to sell them for you. Americans are not allowed to directly
own service centers, either. And all this assumes that Chinese consumers can buy the cars in the
frrst place, because the only financing that is allowed in China is through state-run banks -- and
they don't make loans for cars. Little wonder that there aie many times more bicycles in China
than automobiles.
VSNdV
··----
---··
XV.f SC: 11 G3A\
00/GO/GO
�4
Under the new agreement; it's completely different. Tariffs on American cars will fall by nearly
75 percent, so we can compete in Chinese markets. The requirement that we have to link up with
Chinese enterprisc:s is eliminated. So is'the requirement that we have to transfer our technology.
And, American manufacturers 'Will now be free to use parts made in America for assembly in
China, to set up their own distribution centers, to run their own service shops, and to provide
their own financing to consumers.
From our perspective, it means that we're going to sell a lot more American cars in China, which
means more jobs in America. In return, the Chinese people end up "vith much better products at
lower prices. Take that example and multiply it across
~other industries -- from
manufacturing to high-tech to insurance to agriculture-- and you begin to get an idea of what this
agreement could mean to both our economies.
For our part, we must grant China permanent normal trade relations status. It's important to
understand what that means: it simply means that we will give China the same tariff schedule we
apply to most every other nation in the world, and China will do likewise. It would eliminate the
annUal vote
on~~rlot apply to any other WTOmember. Some have said
we need the annual vote to address other concerns we have 'With China, on human rights,
proliferation, or rdigious freedom. Of
e&m~ngress always has the authority to address any
pan of our relationship with any nation, including China.
~ ~e annual ~~~~ot been .
an effective instrument. It simply has affirmed our tr=-lationship with China for ten years
in a row.
~c~"f.~ ~ut of the cf:kwe are now in. where the
future of Chinese trade comes up for a divisive and not very effective vote very single· year .
The economic benefits of this deal to America are clear. If Congress votes no, we risk losing the
full, enforceable market access benefits of the agreement, as well as the special protections we
negotiated. In a global economy, where global markets are essential, American businesses and
£00~
VSNdV
XVd 8£=11 03M
00/~0/~0
�5
workers would be put at an enormous disadvantage, essentially shut off from one fifth of the
world_ It would be a self-inflicted
wound~e economic health of America_
But I believe the economic benefits are only the beginning of the argument. For I am convinced
that this agreement is as vital to our national security as it is to our economic security_
Our nation has a tremendous stake in how China evolves. We are a Pacific nation which fought
three wars in Asia in the 20tll Century. Our future is tied to Asia. And the stability of Asia-economically, politically and militarily-- is inextricably entwined with the stability and direction
of China. As China develops, the path it illuminates or the shadow it casts will be felt far from
its own borders.
China will write that future as it answers some fundamental questions: It has extended some
freedoms -- but will it gain the stability that can only come from respecting human rights and
pennitting opposing political voices
t~ be heard and felt?~ is refonning its economy -- but will it
unleash the necessary ingredient of sustained growth in the information age- namely access by
its people to knowledge and unfettered
thought~ has become deeply engaged in the
.
international commwrity --but will it make a broad commitment to play by global rules and do
its part to address global challenges like the spread of weapons of mass destruction and climate
change? It is growing stronger-- but will it use that strength to build a more secure Asia, or to
threaten the freedom and security of its neighbors? Ultimately, the answers will come from
China. But we have a enormous stake in encouraging it to choose the path of integration and
reform, not confrontation and decline. Bringing China into the WTO will make a big difference.
To understand why, we need to have a clear-eyed view of China, neither looking through rosecolored glasses or through the glass darkly. We need to look at its progress and its problems, its
system and its strains, its policies and its perceptions of the world_
900~
VSNdV
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In the last 20 years, China has made remarkable progress in building a new economy, lifting
more than 200 million people out of absolute poverty. One incredible resu]t is that China now
has the largest wirdess communications network in the entire world, and is linking so many·
people to one another that it is adding the equivalent of a new Baby Bell every year.
But China faces daunting problems as well. Its working age population is increasing by more
than 12 million pel[)ple --equal to the population of New England-- every year. Tens of millions
of peasants are migrating from the countryside, where they see no future, to the city, where only
some find work. China's political system is plagued by corruption. Its air is so dirty that 25
percent of all deaths in China over the age of five come from chronic respiratory disease, four
times the U.S. rate:. And China's economic growth has slowed just when it needs to be rising to
create jobs for the unemployed and maintain support for economic reform.
For all the progress of China's reforms, private enterprise still accounts for less than one-third of
its GDP. China's state banks still are making massive loans to struggling state firms, the sector
of the economy least likely to succeed, In other words, China cannot maintain stability or ensure
prosperity by rnaiJtltaining the status quo.
What does this mean for us? As the President said when Premier Zhu Rongji visited Washington
last year, "if we've learned anything in the last few years from Japan's long recession and
Russia's current economic troubles, it is that the weaknesses of great nations can pose as big a
challenge to America as their strengths." So as we focus on the potential challenges that a strong
China could present to the United States in the future, let us not forget the risks that could be
posed by a weak China, beset by internal conflicts, social dislocation, criminal activity, and
large-scale illegall emigration -- a vast zone of instability in Asia.
LOO~
VSNdV
XV.:I 6C: 11
<i:3A\
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�7
Our interest lies .in encouraging both stability and change in China by encouraging it to meet, not
stifle, the growing demands of its people for opelliless, accountability, freedom and reform.
Bringing China into the WTO will help in three ways.
First~
8-'\.
this is not just an agreement to expand trade between our two countries. It will obligate
China to deepen its market reforms and open its economy to the world. It will increase the pace
of change in Chiru~
China's tol? leaders understand that economic change is both essential and risky. lt is risky
because opemng China's antiquated economy to global competition is likely to cause more shortterm unemployment and the specter of social unrest. But, interestingly, they also understand that
this change is essential because China cannot make the next leap in development without worldclass industries and products that can compete in the global economy. And the only way to
produce competitive industries is to open the country to outside competition. With this WTO
agreement, they have chosen to continue opening their economy, despite the risks that p·ath
entails. Do we really want to r~ject that choice?
The introduction c1f competition results in natural pressure for progress. A decade ago, China's
best and brightest college graduates sought jobs in the government, in large state-owned. firms or
state-run research institutions or universities. More and more, the best and brightest either are
starting their own companies or choosing to work for foreign-invested companies-- where they
generally get higher pay, a better work environment, and a chance to get ahead based on merit,
not political collile:ctions.
U.S. companies are the leaders in the Chinese market in developing human resources-- by
emphasizing teamwork and respect for individual rights. In tum, more and more, Chinese firms
are learning that unless they change their working style and treat employees with respect, they
will lose out in the competition for top talent. This process will only accelerate as China joins
800~
VSNdV
XV.:I 6C: T1 a3A\
00/GO/GO
�the WTO, and we should do all we can to encourage it, because it will lift the standards of
Chinese workers--· and their expectations.
encourage China to evolve into a more open society.
ln ways that are incomplete, but nonetheless real for millions of ordinary Chinese citizens,
China's economic opening already has given its people greater scope to live their lives. Take
Shanghai, for example, the city that has been most open to international influence. Ten years
ago, people in China did not own their own homes. Today, 25 percent of Shanghai residents are
homeowners. When reforms began, there were no supermarkets, and citizens had to buy food
from state-run outlets using coupons. Today,· there are more than 1,000 supermarkets and no
more rationing of food. A decade ago, Chinese citizens could rarely travel in or out of their own
country. Last year, on New Year's Day, airlines added more than 250 flights to international
destinations from Shanghai alone. Nationwide, China has seen the emergence of more than one
million nonprofit and social organizations -- professional associations, consumer groups, tenant
organizations, envirorunental groups; a 2,500 percent explosion of print and broadcast media;
and local elections in the vast majority of the country's 900,000 villages.
Let us understand: these changes do not mean that the people of China enjoy political freedom.
Chinese authorities still tolera.te no organized political dissent or opposition, and no challenge to
the Communist Party. Over the past year, we have see an increase in its crackdown on political
. activities and dissent; stepped-up controls on unregistered churches; the suppression of ethnic
minority groups:, especially Tibetans; and the. imprisonment of even more dissidents whose only
crime is free speech. Because the Communist Party's ideology has largely been discredited in
China~ and because it lacks the legitimacy that can only come from democratic choice, it seeks to
maintain its grip by suppressing other voices.
·-600~
VSNdV
--
--
----
XV.:I Of;: 11 Q3A\
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�9
So let me make very clear: This agreement is not, by itself, a
~ rights policy for
the United States. We must and we will continue to speak out on behalf of people in China who
are persecuted for their political and religious beliefs. That is why we pushed for the release of
Dickinson College: librarian Song Yongyi [SOONG YOONG-YEE], who was released just last
week. That's why we sponsored a resolution last year in the UN Human Rights Commission
condemning China's human rights record and why we're doing it again this year. We will
.continue to press China to respect global norms on non-proliferation; to encourage a peaceful
resolution of issues with Taiwan; to urge China to be part of the solution to the problem of global
climate change. .
With or without this WTO agreement, we will need to continue to work in all these areas. At the
same time, I believe this agreement will reinforce and complement these efforts, and help move
China in the right direction in fundamental ways.
For example, in the past, the Chinese state was every citizens' employer, landlord, shopkeeper,
and news provider all rolled into one. By advancing privatization, th]s agreement will accelerate
a process that is removing government from vast areas of people's lives ..
By giving investms and property owners predictability and protection against arbitrary
government action, it reinforces the idea that individuals have rights. This will give added
impetus to those trying to strengthen the Chinese legal system in a way that allows citizens to
hold their government truly accountable.
Finally, by openintg China's telecommunications market to cutting-edge American teclmology
and international firms, the WTO agreement will help bring the information revolution to cities
and towns across China. A year ago, China had two million Internet addresses. Today, it has
nine mill~on, Soon, people in some of the most remote villages in interior China will have access
OTO!lJ
VSNdV
XV.:I Of;: TT a3A\
00/60/60
�10
to CNN. And as they become more mobile, more prosperous, and more aware of alternative ways
. of life, I believe tl~ey will seek a stronger voice in shaping their destiny.
Of course, just last week, Beijing announced that it was cracking down on the Internet. It's
outrageous-- but it's also futile. In this infonnation age, cracking down on the Internet is like
King Canute trying to still the waters. Indeed, the fact that the Chinese government is pushing
@
back against the increasing flow of infonnation to the Chinese people only proves that the
changes China is llildergoing are real and
~atening to the status quo.
This kind of
repression is not an argwnent for slowing down the effort to bring China into the world; it's an
argument for accelerating it.
In the end, as China opens to the information economy, it can succeed only as it liberates the
minds of its people and empowers the individual. In this age, you cannot expect people to be
~~~·
creative economically and frozen politically, China may ~cove/that people are far more
11
willing to tolerate wrenching economic change when they have a say in the decisions that affect
their lives. Compare the fates of the governments of an autocratic Indonesia and a democratic
South Korea as they faced the Asian financial crisis over the past two years. Bringing China into
the WTO doesn't guarantee it will make the right choice for political reform. But by accelerating
the process of economic change, it will force China to confront that choice sooner, and make the
imperative for that choice far more powerful.
How will China change? I believe it will be a .,combination of internal pressures for a greater
voice. and external validation of the human rights struggle by the international community. The
WfO agreement "'rill bolster the former while we maintain our leadership role in the latter. Our
policy should no more be measured week to week or year to year than you could have measw-ed
our policy toward 1:he Soviet Union -- with which we continued to engage, even though it posed a
much greater threat to us than China does today.
no~
VSNdV
XV.:I H: 11 G3A\
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�11
This agreement will advance our national security interests in a third way as well: it increases
the chance that in 1the new century China will be on the inside of the international system,
playing by the rule:s, instead of on the outside, denying them.
Under the terms of this agreement, the Chinese government is obliged to publish laws and
regulations. It sub~ects some of its most important decisions, for the first time, to the review of
an international body. Why does that matter?
Quite simply, it applies to China the basic principle at the heart of the concept of the rule of law:
that governments cannot behave arbitrarily at home or abroad, that their actions are subject to
~iu n d Ut rules consistently applied. Remember, China is choosing to embrace these
:igarion$.s China becomes a stakeholder in the WTO and other intel"lUrtional regimes, it will
be more likely to accept the legitimacy of international norms, and define its future within the
international community, not outside of it.
I know some say that if China is allowed to join the WTO, it actually will undennine our effort
to strengthen global norms in two very important areas: labor rights and the environment. But
the fact is, most o:fthe members of the .WTO already are developing countries, with the same
n.;t
concernl\ading rules not become an instrument to restrict their growth. China's membership
won't change that equation. And considering the fact that China is home to one-fifth of the
world's people and the source of a rising share ~f ~reenhouse gas emissions, it is hard to imagine
an effective global effort to meet ~"''~"~
~challenges without China.
.
It's fair to ask: how do we know China will do what it promised to do in the agreement we
signed? Of cours1e, we cannot know for sure. But we do have reasons to believe that it "vill, and
mechanisms. to reinforce that.
VSNdV
XV.:I H: 11 Q3A\
00/60/60
�12
First, China is pledging to open its economy and its markets not just as a means of getting in the
WTO, but because most of its leaders believe reform is in China's interest.
, Second, as a member of the WfO, non-compliance by China is subject to dispute resolution
under the WTO; like any other coWltry, China will confront judgments backed by a 135-member
body, rather than being able to chalk up friction to supposed U.S. bullying. Right now, if China
treats our products unfairly, we have no recourse, short of pulling the plug on trade. This
agreement increas,~s our leverage with China in the event of a future trade dispute. If Chi]la does
not comply with adverse rulings by the WTO, we are entitled to take equivalent action against
China. .A:RQ ta~ p;eeess ~·· es tbe feFees af Feferm vvit:h!n: China gretttei k eciage to insist tHat
In the end, we must and will continue to protect our interests with firmness and candor. But we
must do so without isolating China from the global forces that can empower its people to build a
better future. That would leave the Chinese, people with less access to information, less contact
with the democratic world, and more resistance from their government to outside influence and
ideas. No one could possibly benefit from that except for the most rigid, anti-democratic
elements in China. itself.' Let's not give them a victory by locking China out of the WTO.
The question is not whether or not this trade agreement by itself will cure serious and disturbing
issues of economic and political freedom in
China~e issue is whether it will push things in the
right direction. President Clinton believes it will. Some, of the most courageous proponents of
change in China agree. Martin Lee, leader of Hong Kong's Democrati@rty, says that without
0. c
7
entry to the WTO, "any hope for the political and reform process would also recede." And
Chinese dissident Ren Wanding [REN WAHN-DING] said upon the deal's completion:
"Before, the sky was black. now it is light. This can be a new beginning."
VSNdV
XV.f Tt: 11 G3A\
00/G0/60
�13
It is our shared conviction that supporting this agreement is a new beginning. It is the right thing
for America, for China, for Asia, and for the world. It will increase the chance that China will
define its future within the international community, and move toward a more open society that
upholds the rule of law. That is what is at stake in this debate. Let us have the wisdom to choose
wisely. Thank you.
VSNdV
�02-/02/00
WED 11:
42
FAX
1(1] 015
APNSA
Sutphen, Mona K. (NSA)
From:
Sent:
To:
Cc:
Subject:
0¥- -
Orzulak, Paul K. (SPCHW)
Wednesday, February 02, 2000 10:15 AM
@NSA- Natl Security Advisor
@SPEECH - NSC Speechwriters; @PRESS - Public Affairs; @ASIA- Asian Affairs
One add!tion to China speech from State (UNCLASSIFIED]
For SRB:
State called to say that Secretary Albright would like to add in our litany of steps we
have taken on human rights the fact that we sanctioned China as a ''country of
particular concern .. under the International Religious Freedom Act last year. @speech
and @asia agree.
1
�Orzulak, Paul K. ·(SPCHW)
Orzulak, Paul K.. (SPCHW)
Wednesday, February 02, 2000 10:15 AM
@NSA - Natl Security Advisor
@SPEECH - NSC Speechwriters; @PRESS - Public Affairs; @ASIA - Asian Affairs
One addition to China speech from State [UNCLASSIFIED]
From:
Sent:
To:
Cc:
Subject:
For SRB:
State called to say that Secretary Albright would like to add in our litany of steps we
have taken on human rights the fact that we sanctioned China as a "country of particular
concern" under the International Religious Freedom Act last year. @speech and @asia
agree.
)
1
�II
'Mt' two
affect their lives. Compare the fates of the governments of an autocratic Indonesia and a
Wt{,fkt.,
I
~
•
democratic South Korea as they faced the Asian financial Jrisl~ BringJng China into the WTO .
doesn't guarantee it will make the right choice for political reform. But by accelerating the
process of economic change, it will force China to confront that choice sooner, and make the
·imperative for that choice far more powerful.
.
-
How will China change? I believe it will be a combination of internal pressures for a greater
voice and external validation of the human rights struggle by the international community. The
s. JJ \...u--
[:...;,..,._-.
WTO agreement will cantribHh~=to the intemal forces :while we ~aintain our leadership
role in the latter. · Our policy should no more be measured week to week or year to year than you
could have measured our policy toward the Soviet Union !\with which we continued to engage,
even though it posed a much greater threat to us than China does today.
This agreement will advance our national security interests in a third way as well: it increases
the chance that in the new century China will be on the inside of the international system,
playing by the rules, instead of on the outside, denying them.
Under the terms of this agreement, the Chinese government is obliged to publish laws and
regulations. It subjects some of its most important decisions, for the first time, to the review of
an international body. Why does that matter?
Quite simply, it applies to China the basic principle at the heart of the concept of the rule of law:
that governments cannot behave arbitrarily at home or abroad, that their actions are subject to
limits and to rules consistently applied. Remember, China is choosing to embrace these
obligations. As China becomes a st~eholder in the WTO and other international regimes, it will
be more likely to accept the legitimacy of international norms, and define its future with~n the
international community, not outside of it.
�12
I know some say that if China is allowed to join the WTO, it actually will undermine our effort
to strengthen global norms in two very important areas: labor rights and the environment. But
the fac~~J~ the members of the WTO already are developing countries, with the same
concerns
th~ ~ become an· instrument to .restrict their growth.
China's
. .
membership won't change that equation. And considering the fact that China is home to onefifth of the world's workers and the source of a rising share of greenhouse gas emissions, it is
hard to imagine an effective
glob~! effort to meet ~allenges without China. · Tty ing::to
.ffl!ike nece~~ar ~ l't'6gfess on hrbm
1111d
the en·. imtuHeHt in a: gl~b!il system that d~es Het iRelude
China vvoold be IilEs buileiAg a ilsuse witH: a: re~ftfiat cgvsrs jttst fettf fifths of the feeffis.
It's fair to ask: how do we know China will do what it promised to do in the agreement we
signed? Of course, we cannot know for sure. But we do have reasons to believe that it will, and
mechanisms to reinforce that.
First, China is pledging to open its economy and its markets not just as a means of getting in the
WTO, but because most of its leaders believe reform is in China's interest.
Second, as a member of the WTO, non-compliance by China is subject to dispute resolution,.)l--under the WTO; like any other country, China will confront judgments backed by a 13 5member body, rather than being able to chalk up friction to supposed U.S. bullying. Right now,
if China treats our products .unfairly, we have no recoprse, short of pulling the piug on trade.
This agreement increases our leverage with China in the event of a future trade dispute. If China
does not comply with adverse rulings by the WTO, we are entitled to take equivalent action
against China. And this process gives the forces of reform within China greater leverage to
insist that China move in the right direction.
In the end, we must and will continue to protect our interests with firmness and candor. But we
must do so without isolating Chinafrom the global forces that can empower its people to build a
�•
13
better future. That would leave the Chinese people with less access to infonnation, less contact
with the democratic world, and more resistance from their government to outside influence and
ideas. No one could possibly benefit from that except for the most rigid, anti-democratic
elements in China itself. Let's not give them a victory by locking China out of the WTO.
The question is not whether or not this trade agreement by itself will cure serious and disturbing
issues of economic and political freedom in China; the issue is whether it will push things in the
right direction. President Clinton believes it will. Some of the most courageous proponents of
change in China agree. Martin Lee, leader of Hong Kong's n·emocratic party, says that without
entry to the WTO, "any hope for the political and refonn process would also
reced~d
Chinese dissident Ren Wanding [NOTE: CHECK PRONUNCIATION] said upon the deal's
completion: "Before, the sky was black. now it is light. This can be a new beginning."
-
It is our shared conviction that supporting this agreement is a new beginning. It is the right thing
. democratic society. That is what is at stake in this debate.
ve the wisdom to choose
wisely. Thank you.
(REN
WAHN- DIN((-)
�2/1/00 9:00 p.m.
Orzulak
NATIONAL SECURITY ADVISOR SAMUEL R. BERGER
REMARKS TO
THE WOODROW WILSON CENTER
ON CHINA
WASHINGTON, D.C.
FEBRUARY 2, 2000
Speaking to the Wilson Center is always a challenging prospect. It brings to mind the story of
the man who lived through the famous Johnstown flood. All his life, this man would ~
tell everybody he met the story of how he survived. When he died and went to heaven, he asked
St. Peter to convene.a crowd so he could tell them about the great flood. St. Peter said, "I'd be
happy to. But you have to remember one thing-- Noah will be in the audience."
There's more than One foreign policy Noah in
.
thi~t~~e~. Indeed, Lee Hamilton
. 1-.a.e
himself comes with an entire Ark. For 20 years, "brought a steady hand to foreign policy in
Congress, with the emphasis always on patriotism, not partisanship. I thank him for that.
Last week in his State of the Union Address, the President gave a compelling summary of the
challenges America will face in the 21st Century. Looking ahead, there's good reason for
~~~CA.-~
OU/L
optimism. A.w.efit;;a is m/ayia~he longest economic expansion in""history. Our military
.
~ '"1Ju._
w tnltl.. .
strength is unchallenged. Our alliances are strong. Our values are ascendan}\ ~ighty years after
~W~~~~~~rican leadership would help make the world safe for democra~
Ujfore tflan half the world's people ~r gove~ents of their own choosing.
But as the President said, this is not a world without dangers to us. Our security can be
threatened by regional conflicts that pose the risk of a wider war. The march of technology can
. ·.
give terrorists and hostile nations the means to undermine our defenses, and force us to once
again live in fear. The stability of the 21st Century can be threatened by an ever-widening gap
�;.
2
between rich and poor. And of course, there is the possibility that our former adversaries Russia
and China will fail to emerge in this century stable, prosperous, and democratic.
Today, I want to talk about China. Since President Nixon went to China in 1972, the United
States has sought to develop a constructive relationship with Beijing, initially as a
counterweight to the Soviet Union and later in recognition of China's growing importance in its
own right. We have worked for the emergence of a China with an economy that is open to
American products, farmers, and businesses. A China whose people have access to ideas and
information. A China that upholds the rule of law at home and adheres to global rules on
everything from nuclear non-proliferation to human rights to trade.
rs
This year, we have an unprecedented opportunity to advance those goals. · The opportunity~
China's entry into the World Trade Organization.
But before Americacan realize the full market-opening benefits of Chinese entry into the WTO,
'
. Congress must answer a
.
sim~le
question: will it grant China permanent Normal Trade Relations
0
M~~lft!lfiE~~Jissnn~edc~siiiaryfV1<to guarantee the full benefits of the agreement we negotiated
:.:.::.:...::.:.=~=- he s arne arrangement we have given to 13 2 of the other 13 4 countries in the
WTO? Or will Congress tum its back on the~ping changes·China has agreed to make
~
and risk losing ground on the issues we all care about?
This will be an intense and important debate. There are legitimate concerns about China. So let
me take a few minutes today to talk about why supporting this
for China --~y in our economic interest,
~
agreem~~kar:d permanent NTR
.
bu~n our national security interest as well.
Every debate on trade must first answer the threshold question: will our economy and our
workforce benefit from the terms we've negotiated, or will they suffer? From an economic
perspective, there is no denying that this agreement strongly benefits the United States.
�,.
3
··~.
For years,
Ch.in~ has ha~ ~to our markets, while its markets have been in
many ways closed to American products and. services .. Indeed, we ran a $63 billion trade deficit
with China last y¥·largest with any country. This agreement requires China-to make
C Wlk-lt~
. .
.
·
~';(J./
.
· &;;GepinCne~sions to open·its mark~ J IM..;...e, whi~e we have~ agree~~
'
7\
'-'\
.0
maintain the market access policies we already apply to Chin,X-9¥~~·~-+·~!!:mlMl~~~
.
~;~~ 'cb-kr, ve,. /
Denying China PNTR would ~ly ~~FiWn."merican compames an w ers
e
~rable market access
anptiye @tif@Feemeftt HlHntgk
that our European, Japanese, nd other
competito~ve.
Cklltt.YJ.Id ;~ __
Vll'~ dispute settleme~~
""
.
This agreement will dramatically reduce China's tariffs on everything from agricultural and
industrial products to computers and semiconductors. It directly responds to concerns about
unfair trade practices in Chir¥rom product dumpiJ?.g to technology
Ul~
protections against import surges from China that we fiave
·
transfe~ gives us
.
no other·country.
D
.
.
.
~f o;t-h
.
.~b .~
. .
1t a11.ows our busmesses to export to China ronr{ orne, an d hav.e t he1r own 1stn ut10~n Ch.ma,
rather than being forced to set up factories in. China to sell products. through Chinese control.
That is what this agreement means in principle. Here is what it means in practice.
Consider the auto industry. Right now, a car made in Dearborn faces an 80 to 100 percent tariff
before it can be sold in China --which prices us out of the market. If you want to sell cars in
=
China, you need to base your operations in China. To do that, you must form a joint venture
..
~et6 r;..e_. ·~ '
with a ~inese
1 1 9 ete ~n enterprise and give t~at least 51 o/~ You als~ m~sro
transfer
~amoun~ your technology to China, and teach the Chinese how to use it --
"'J"'e- {?.)
which means you are transferring both your product and expertise to your eventual competitors.
And because of local content requi~ements, most parts have to be made in China, too.
In addition, Americans cannot now directly run parts distribution centers in China, so once your
parts are made, Chinese partners have to sell them for you. Americans are not allowed to
�..
4
directly own service centers, either. And all this assumes that Chinese consumers can buy the
I
cars in the first place, because the only financing that is allowed in China is through state-run
·ban~they don't ~ake loans for cars. Little wonder that t~ere are many times more
-
bicycles in China than automobiles.
. WI1.R_
. Under the new agreement, it's completely different. Tariffs on American car~all by nearly 75
percent, so we can compete in Chinese markets. The requirement that we have to link up with
Chinese enterprises is eliminated. So is the requirement that we have to transfer our, technology.
And, American manufacturers will now be free to use parts made in America for assembly in
China, to set up their own distribution centers, to run their own service shops, and to provide
their own financing to consumers.
From our perspective, it means that we're going to sell a lot more American cars in China, which
means more jobs in America. In return, the Chinese people end up with much better products at
lower prices. Take that example and multiply it ~oss all of our other industries~from
--
~
.
manufacturing toe_...h""ig..,.~ll..t..,tc'""c~h,.;t~u..,lliin~suilir~H~uee-tQ agriculture/\ andyou begin to get an idea of what this ·
agreement could mean to both our economies.
For our part, we must grant China permanent normal trade relations status·. It's important to
understand what that means: it simply means that we will give China the same tariff schedule we
apply to most every other nation in the world, and China will do likewise. It would eliminate
the annual vote on China MFN, which we do not apply to any other WTO member. Some have
said we need the. annual vote to address other concerns we have with China, on human rights,
(17-,~
.
proliferation, or religious freedom./\,.Congress cdways has the authority to address any part of our
relatio;::twith any nation,
.f"~~lll~of our rela;inn•"ip wit!! Cbil>a ar ""¥ <>tl>er
· cottl\iry1\. tp.e 'annual MFN vote has l'lOt been an effective instrument.~~ly affirmed our
trading relationship with China for ten years in a row. Ia
.tariff~,
became it b:a~
~ucb:
a dramatic
8f~et
m.aR~' 'Hayten~~
ee l:lS as me!! as tbem, make~ it as iseffeetiv'e
�~~'~, .. ~
5
.. ...._._..~ ~dt:mtJ ~~
Mtretiy. What
will do is get us out of the cycle WI:? are ow in, where the future of Chinese
dtvU~ A~11 ~+~ ~~Vc.,.
trade comes up ~Or ~ote every Single yea/ in vO~(!j~ efl.
Theeconomic benefits ofthis deal to America are dear. If Congress votes no, we risk losing the
full, enforceable market access benefits of the agreement, as well as the special protections we
hv
negotiated.
~a
.
.
global economy, where global markets are essential, American businesses and
workers would be put at an enormous disadvantage,
essentially~~fth of the
world. It would be a self-inflicted wound that would hurt the economic health of America.
~J..~~
.
'
Fc::az;;A the econ?mic benefits are only the beginning of the argument, not the end. For I am
convinced
tha~ ~national security as it is to our economic security.
Our nation has a tremendous stake in how China evolves.
ur
re ts
tie to
Asia.~~ility of Asia;-;;conomically, politically and militarily;-;;. inextricably entwine
with the stability and direction of China. As China develops, the path it illuminates or the
shadow it casts will be felt ~rom its own borders:
China will write that future as it answers some fundamental questions: It has extended some
freedoms -- but will it gain the stability that can only come from respecting human rights and
permitting opposing political voices to be heard ;::d felt? It is reforming its economy -- but
will it unleash the necessary ingredient of sustained growth in the information age- namely
b,;f!Ditifbl.L
.
accetxo khoWfedge and unfettered thought? It has become deeply engaged in the international
community -- but will it make a broad commitment to play by global rules and do its part to
address global challenges like the spread of weapons of mass destruction and climate change? It
is growing stronger -- but will it use that strength to build a more secure Asia, or to threaten the
freedom and security of its neighbors? Ultimately, the answers will come from China. But we
have a enormous stake in encouraging it to choose the path of integration and reform, not
.confrontation and decline. And bringing China into the WTO will
make~terence
�;
.
6
To understand why, we
n~ed to have a clear-eyed vie,; of Chi~~er looking through
rose-colored glasses or through the glass darkly. We need to
problems, its system and its strains, its policies and its
loo~~rogress and its
perceptio~s
of us, of itself, and the world.
In ~he last 20 years, China has made remarkable progress in building a new economy, lifting
more than 200 million people out of absolute poverty~ncredible result is that China now
has the largest wireless communications network
to one
i~ and is linking so man~rs
anothe~addiilg the equivalent of a new Baby Bell every year.
.·.
But China faces daunting problems as well. Its working age population is increasing by more
--
---
than 12 million people}\ equal to the population ofNew England/\ every year. Tens of millions
of peasants are migrating from the countryside, where they see no future, to the city, where only
some find work. China's politicalsystem has become plagued by corruption. Its air is so dirty
that 25 percent of all deaths in China over the age of five come from chronic res~iratory disease,
four times the rate ofthe United States. And China's economic growth has slowed just when it
needs to be rising to create jobs for the unemployed and maintain support for economic reform.
For all the progress of China's reforms, private enterprise still accounts for less than one-third of
its GDP. China's state banks still are making massive loans to struggling state firms, the sector
cifthe economy least likely to succeed.
0'1-bt
China's top leaders understand that economic change is both essential and risky. 'Fftey
7\ risky
because opening China's antiquated economy to global competition is likely to cause more
short-term unemployment and the specter of social unrest. But, interestingly, they also
understand that this change is essential because China cannot make the next leap in development
-without world-class industries and products that can compete in the global economy. And the
.
\
�7
only way to produce competitive industries is to open the country to outside competition. In
other words, China simply cannot ensure stability by maintaining the status quo.·
What ~oes this mean for us? As the President said when Premier Zhu Rongji visited Washington
last year, "if we've learned anything in 1the last few years from Japan's long recession and
Russia's current economic troubles, it is that the weaknesses of greatnations can pose as big a
challenge to America as their strengths." So as we focus on the potential challenges that a strong
China could present to the United States in the future, let us not forget the risks that could be
posed by a weak China, beset by internal conflicts, social dislocation, criminal activity, and
large-scale illegal emigration -- a vast zone of instability in Asia.
Our interest lies in encouraging both stability and change in China by encouraging it to meet, not
stifle, the growing demands of its people for openness, accountability, freedom and reform.
Bringing China into the WTO will help in each way.
/kW?
First, this is not just an agreement to expand trade between our two countries. It will obligate·
en its s'ociet to the world: It will increase the ace of
"""-
["~~~
change.--{\
Those Chinese leaders who are reform-minded understand that lowering tariffs and other barriers
exposes China's state-run industries to competition; many will not be able to compete without
fundamental changes in ownership and management. But they also understand that forcing firms
to compete is something China must do to sustain its growth.· With this WTO agreement, they
have chosen to continue opening their economy, despite the risks that path entails. Do we really
want to reject that choice?
The introduction of competition results in natural pressure for progress .. A decade ago, China's
best and brightest college graduates sought jobs in the government, in large state-owned firms or
�--------------------------------------------~
s·
state-run research institutions or universities. More and more, the best and brightest either are
starting their own companies or choosing to work for foreign-invested companies -- wh~~e they
.
.
generally get higher pay, ·a: better work environment, and a chance to get ahe.ad based on merit,
not political connections .
. ~,,dmtf!F BttFVeys slurx ~(M U.S. companies are the leaders in the Chinese m~rket in developing ·
human resources -- by emphasizing teamwork and respect for individual r~ghts. In tum; more
and more, Chinese firms are learning that unless. they ch~mge'their working style.:and treat
employees with resP,ect, they will lose out in the competition fortoptalent. This process will
only accelerate as China joins the WTO, and we
sh~uld do :all we can to encourage it, because it
·'
will lift the standards of Chinese workers
.
1\ and their expectations ..
Second, by accelerating economic change, the agreement we re~ched also has the potential to
encoura
In ways that are halting, incomplete, but nonetheless real for millions of ordinary Chinese
citizens, China's economic opening already.lias given it.s people greater scope td liv.e their lives .
.
....
Take Shanghai, for example, the city that has beev. ~most open to intemation.al influence. ien
·
'"'~~?!au •«c""~J"':
. )\\.-...~ . .
. .·
.
years ago, "t+wa:J €'gal for people m Chma.kl own the1r own homes. Today, 25 percent of
.
.
.
Shanghai residents are homeowners. Ten·years ago, there were no supermarkets, and citizens
'
had to buy food from state.,.flin outlets using coupons. Today, there ~re more than 1,000
.
.
.
supenparkets and no mote rationing of food. A decade ·ago, Chinese citizens could rarely travel
in or out of.their own country. Last year, on New Year's Day, airlines added more than 250
flights to international destinations from Shanghai alone .. Nationwide, China has seen: the .
.
~
.
~.
emergence of more than 200,000 professional ass,ociations, consumer g~oups, teriant
organizations, environmental groups; a 2,500 percent explosion ofprint anci. broadcast media ,
over the past 25 years; and local elections inthe vastmajority of the country's 900,000villages.
�..
..
9
political freedom. Chines authorities still tolerate no organized political dissent or opposition,
and nd challenge to the C mmunist Party. Over the past year, weihave see an increase in its
crackdown on political a tivities and dissent; stepped-up controls on unregistered churches; the
suppression of ethnic
nority groups, especially Tibetans; and the imprisonment of even more
dissidents whose only
ime is free expression and free speech. Because the Communist Party's
ideology has largely b n discredited in China, and because it lacks the legitimacy that can only
come from democratic choice, it seeks to maintain its grip by suppressing other voices.
1ll continue to speak out on behalf of the people in China who are
persecuted for their political and religious beliefs. That is why we worked hard for the release of
Dickinson College librarian Song
Yon~':~ ;;;;;.J/ased just last week.
That's why we
sponsored a resolution lastyear in the UN Human Rights Commission condemning China's
human rights record and why we're doing it again. this year. We will continue to press China to
respect global norms on non-proliferation; to encourage a peaceful resolution of issues with
Taiwan; to urge China to be part of the solution to the problem of global climate change.
· ·
.
.
~ ~ 1(011·~, ~ec.)
We must continue to work in all these areas. CeHstaat prili:~Plf@ is
f8EJ-Ylf@Q
iH ttll these afiaS~---
ftu~t~r;
q...
,
.
~oiY~~
In th~·past, the Chinese state was every citizens' employer, landlord, shopkeeper, and news
provider all rolled into.one. By advancing privatization, this agreement will accelerate a process
�'
10
By giving investors and property owners predictability and protection against arbitrary
government ac~ion, it reinforces the idea that individuals have rights: This will give added
impetus to those trying to strengthen the Chinese legal system in a way that allows citizens to
hold their government truly accountable.
Finally, by opening China's telecommunications market to cutting-edge American technology
and international firms, the WTO agreement will help bring the information revolution to cities
and towns across China. A year ago, China had two million Internet users. Today, it has nine
million. Soon, people in some of the most remote villages in interior China will have access to
CNN. And as they become more mobile, more prosperous, and more aware of alternative ways
of life, I believe they will seek a stronger voice in shaping their destiny.
Of course, just last week, Beijing announced that it was cracking down on the Internet.
)'El:P
~
*hinh @I" rt :ft,]'s outrageous-- but it's also futile. In this information age, cracking down
on the Internet is
like~ag iw aoil JsHe te 14 . 1JJc~M-like King Canute trying to still the watert
Indeed, the fact thatthe Chinese-government is pushing back against the increasing flow of
information to the Chinese people only proves that the changes China is undergoing are real and
deeply threatening to the status quo. This kind of repression is not an argument for slowing
down the effort to bring China into the world; it's an argument for accelerating it.
In the end, Glliaes@ leaelets must come tc anderstan;r;; China opens to the information
economy, it can succeed only as it liberates the minds
of~le and empowers the
individual. In this age, you cannot expect people to be creative economically and frozen
politically. NationS that
~
~g success in the global economy encourage creative thinking ~~
and risk taking. t d the more people are educated, the more they tend to think for themselv~
It
;;-
~o true that nations that adjust best
to the global economy discover that people are far
more willing to tolerate wrenching economic change when they have a say in the decisions that
§.
~
'
�r
11
affect their lives. Compare the fates of the governments of an autocratic Indonesia and a
democratic South Korea as they faced the
Asian~~lrr.rt~n~hlna into the WTO
doesn't guarantee it will make the right choice for political reform. But by accelerating the
process of economic change, it will force China to confront that choice sooner, and make the
imperative for that choice far more powerful.
How will China change? I believe it will be a combination of internal pressures for a greater .
voice and external validation of the human rights struggle by the international community. The
WTO agreement will contribute to the internal forces while we must maintain our leadership
role in the latter. Our policy should no more be measured week to week or year to year than you
could have measured our policy toward the Soviet Union !\with which we continued to engage,
even though it posed a much greater threat to us than China does today.
This agreement will advance our national security interests in a third way as well: it increases
the chance that in the new century China will be on the inside of the international system,
playing by the rules, instead of on the outside, denying them.
Under the terms of this agreement, the Chinese government is obliged to publish laws and
regulations. It subjects some of its riwstimportant decisions, for the first time, to the review of
'
an international body. Why does that matter?
Quite simply, it applies to China the basic principle at the·heart of the concept of the rule of law:
that governments cannot behave arbitrarily at home or abroad, that theiractions are subject to
limits and to rules consistently applied. Remember, China is choosing to· embrace these
obligations. As China becomes a stakeholder in the WTO and other international regimes, it will
be more likely to accept the legitimacy of international norms, and define its future within the
international community, not outside of it.
�12
I know some say that if China is allowed to join the WTO, it actually will undermine our effort
to strengthen global norms in two very important areas: labor rights and the environment. But
the fac~1: the members of the WTO already are developing countries, with the same
concerns
th~ ~ become an instrurrient to restrict their growth.
China's
membership won't change that equation. And considering the fact that China is home to onefifth of the world's workers and the source of a rising share of greenhouse gas emissions, it is
. hard to imagine an effective global effort to meet
~allenges without China.
Trs i tg;to
4H:a-ke rteeessaty f'regress on labor and the ew., ireHffiertt iH a gl6bal system that does H:et iHslude
China I'Voold be lilce eHileiRg a aeHse witH a ffi6f t:Hat ce.vers just fettr fifths of the meftls.
It's fair to ask: how do we know China will do what it promised to do in the agreement we
signed? Of course, we cannot knmv for sure. But we do have reasons to believe that it will, and
mechanisms to reinforce that·.
First, China is pledging to open its economy and its markets not just as a. means of getting in the
WTO, but because most of its leaders believe reform is in China's interest.
Second, as a member of the WTO, non-compliance by China is subject to dispute resolution_..}Lunder the WTO; like any other country, China will confront judgments backed by a 135member body, rather than being able to chalk up friction to supposed U.S. bullying. Right now,
if China treats our products unfairly, we have no recourse, short of pulling the plug on trade.
This agreement increases our leverage with China in the event of a future trade dispute. If China
does not comply with adverse rulings by the WTO, we are entitled to take equivalent action
against China. And this process gives the forces of reform within China greater leverage to
insist that China move in the right direction.
In the end, we must and will continue to protect our interests with firmness and candor. But we
must do so without isolating China from the global forces that can empower its people to build a
�I
I
.1.
13
better future. That would leave the Chinese people with less access to information, less contact
with the democratic world, and more resistance from their government to outside influence and
ideas. No one could possibly benefit from that except for the most rigid, anti-democratic
elements in China itself. Let's not give them a victory by locking China cmt of the WTO.
The question is not whether or not this trade agreement by itself will cure serious and disturbing
issues of economic and political freedom in China; the issue is whether it will push things in the
right direction. President Clinton believes it will. Some of the most courageous proponents of
change in China agree. Martin Lee, leader of Hong Kong's Democratic party, says that without
entry to the WTO, "any hope
forth~ political and reform process would also reced~d
Chinese dissident Ren Wanding [NOTE: CHECK PRONUNCIATION] said upon the deal's
completion: "Before, the sky was black. now if is light. This can be a new beginning."
-
It is our shared conviction that supporting this agreement is a new beginning. It is the right thing
.
.
democratic society. That is what is at stake in this debate.
ve the wisdom to choose
wisely. Thank you.
·[~·
WAH N-
DI tJ
<r}
�....
THE WHITE HOUSE
Office of the Press Secretary
EMBARGOED FOR RELEASE
UNTIL 12:30 P.M. EST
WEDNESDAY, FEBRUARY 2, 2000
As Prepared for Delivery
REMARKS BY SAMUEL R. BERGER
ASSISTANT TO THE PRESIDENT FOR NATIONAL SECURITY AFFAIRS
ON CHINA
The Woodrow Wilson International Center for Scholars
Washington, D.C.
February 2, 2000
Speaking to the Wilson Center is always a challenging prospect. It brings to mind the story of
the man who lived through the famous Johnstown flood. All his life, this man would tell
everyb_ody he met_the story of how he survived. When he died and went to heaven, he asked St.
Peter to convene crowd so he could tell them about the great flood. St. Peter said, "I'd be
happy to. But you have to remember one thing-- Noah will be in the audience."
a
There's more than one foreign policy Noah in this distinguished audience. Indeed, Lee
Hamilton himself comes with an entire Ark. For more than 30 years, Lee brought a steady hand
to foreign policy in Congress, with the emphasis ~lways on patriotism, not partisanship. I thank
him for that.
·
·
Last week in his State of the Union Address, the President gave a compelling summary of the
challenges America will face in the 21st Century. Looking ahead, there's good reason for
optimism. This month, America marks the longest economic expansion in our history. Our
military strength is unchallenged .. Our alliances are strong. Oui values are ascendant in the
world. Eighty years after Woodrow Wilson hoped American leadership would help make the
world safe for democracy, for the first time ever, more than half the world's people now live
under governments of their own choosing.
But as the President said, this is not a world without dangers to us. Our security can be
threatened by regional conflicts that pose the risk of a wider war. The march of technology can
give terrorists and hostile nations the means to undermine our defenses, and force us to once
again live in fear. The stability of the 21st Century can be threatened by an ever-widening gap
between rich and poor. And of course, there is the possibility that our former adversaries Russia
and China will fail to emerge in this century stable, prosperous, and democratic.
�2
Today, I want to talk about China. Since President Nixon went to China in 1972, the United
States has sought to develop a constructive relationship ~ith Beijing, initially as a
counterweight to the Soviet Union and later in recognition of China's growing importance in its
own right. We have worked for the emergence of a China that contributes to. peace in Asia. A
China with an economy that is open to American products·, farmers, and businesses. A China
whose people have access to ideas and information, that upholds the rule of law at home and
adheres to global rules on everything froin nuclear non-proliferation to human rights to trade.
This year, we have an unprecedented opportunity to advance those goals. The opportunity is
China's entry into the World Trade Organization.
But before America can realize the full market-opening benefits of Chinese entry into the WTO,
Congress must answer a simple question: w1ll it grant China permanent Normal Trade Relations
status, which is the same arrangement we have given to 132 of the other 134 countries in the
WTO. Doing so is necessary to guarantee the full market-opening benefits of the agreement we
negotiated with China. Or will Congress turn its back on the sweeping changes China has
agreed to make and risk losing ground on the issues we all care about?
Every debate on trade must first answer the threshold question: will our economy and our
workforce benefit from the terms we've negotiated, or will they suffer? From an economic
perspective, there is no denying that this agreement strongly benefits the United States.
For years, China has had· open access to our markets, while its markets have been in many ways
closed to American products and services. This agreement requires China to make wide-ranging
new concessions to open its market, while we have agreed only to maintain the market access
policies we already apply to China. Denying China PNTR simply would deprive American
companies and workers of the full bene!its of China's concessions - the favorable market access
and dispute settlement that our European, Japanese, and other competitors will have.
This agreement will dramatically reduce China's tariffs on everything from agricultural and
industrial products to computers and semiconductors. It directly responds to concerns about
unfair trade practices in China and allows our businesses to export to China from here at hom~,
and have their own distribution network in China, rather than being forced to set up factories
there to sell products through Chinese partners.
That is what this agreement means in principle .. Here is what it means in practice.
Consider the auto industry. Right now, a car made in Dearborn faces an 80 to 100 percent tariff
before it can be sold in China --w4ich prices us out of the market. If you want to sell cars in
China, you need to base your operations in China. To do that, you must form a joint venture
with a Chinese state-run enterprise and give it at least a 51% stake. You also must agree to
transfer a significant amount of your technology to China, and teach the Chinese how to use it -which means you are transferringboth your product and expertise to your eventual competitors.
And because of local content requirements; most parts have to be made in China, too.
�3
In addition, Americans cannot now directly run parts distribution centers in China, so once your
parts are made, Chinese partners have to sell them for you. Americans are not allowed to
directly own service centers, either. And all this assumes that Chinese consumers can buy the
cars in the first place, because the only financing that is allowed in China is through state-run
banks -- and they don't make loans for cars. Little wonder that there are many times more
bicycles in China than automobiles.
Under the new agreement, it's completely different. Tariffs on American cars will fall by nearly
75 percent, so we can compete in Chinese markets. The requirement that we have to link up
with Chinese enterprises is eliminated. So is the requirement that we have to transfer our
technology. And, American manufacturers will now be free to use parts made in America for
assembly in China, to set up their own-distribution centers, to run their own service shops, and to.
provide their own financing to consumers.
From our perspective, it means that we're going to sell a lot more American cars and auto parts
in China, which·means more jobs in Arner~ca. ·In return, the Chinese people end up with much
better products at lower prices. Take that example and multiply it across our other industries -from manufacturing to agriculture ..,;. and you begin to get an idea of what this agreement could
mean to both our economies.
For our part, we must grant China permarient norma1. trade relations status. It's important to ·
.
understand what that means: it simply means that w~ will give China the same tariff schedule we
apply to most every other nation in the world, and China will do likewise. It would eliminate
the annual vote on China's trade status, which we do not apply to any other WTO member.
Some have said we need the annual vote to address other concerns we have with China, on
human rights, proliferation, or religious freedom. But Congress always has the authority to
address any part of our relationship with any nation, including China. The annual China trade
vote has not been an effective instrument. It simply has.affirrried our trading relationship with
China for 20 years in a row. What permanent normal trade relations status for China will do is
get us out of the cycle· we are now in, where the future of Chinese trade comes up every single
year for a divisive and not very. effective vote.
The economic benefits of this deal to America are clear. If Congress votes no, we risk losing the
full, enforceable market access benefits of the agreement, as well as the special protections we
negotiated. In a global economy, where global markets are essential, American businesses and
workers would be put at an enormous disadvantage, essentially shut off from one fifth of the
world. It would be a self-inflicted wound for the economic health of America.
But I believe the economic benefits are oniy the beginning·ofthe argument. For I am convinced
that this agreement is as vital to our national security as it is to our economic security.
Our nation has a tremendous stake in how China evolves. We are a Pacific nation which fought
three wars in Asia in the 20th Century. Our. future is tied to Asia. And the stability of Asia-economically, politically and militarily-- is inextricably entwined with the stal;lility and direction
of China. As China develops, the path it illuminates or the shadow it casts will be felt far from
its own borders.
�4
China will write that future as it answers some fundamental questions: It has extended some
freedoms -- but will it gain the stability that can only come from respecting human rights anq
permitting opposing political voices to be heard and felt? It is reforming its economy-- but will
it unleash the necessary ingredient of sustained growth in the information age- namely access
by its people to knowledge and unfettered thought? It has become deeply engaged in the
international community -- but will it make a broad commitment to play by global rules and do
its part to address global challenges like the spread of weapons of mass destruction and climate
change? It is growing stronger -- but will it use that strength to build a more secure Asia, or to
threaten the freedom and security of its neighbors? Ultimately, the answers will come from
China. But we have a enormous stake in encouraging it to choose the path of integration and
reform, not confrontation and decline. Bringing China into the WTO will make a big difference.
To understand why, we need to have a clear-eyed view·ofChina, neitherlooking through rosecolored glasses or through the glass darkly. We need to look at its progress and its problems, its
system and its strains, its policies and its perceptions of the world.
.
In the last 20 years, China has made remarkable progress in building a new economy, lifting
more than 200 million people out of absolute poverty. One incredible result is that China now
has the largest wireless communications network in the entire world, and is linking so many
people to one another that it is adding the equivalent of a new Baby Bell every year.
But China faces daunting problems as well. Its working age population is increasing by more
than 12 million people-- equal to the population ofNewEngland --every year. Tens of
millions of peasants are migrating from the countryside, where they see no future, to the city,
where only some find work. China's political system is plagued by corruption. Its air is so dirty
that 25 percent of all deaths in China over the age of five come from chronic respiratory disease,
four times the U.S. rate. And China's economic growth has slowed just when it needs to be
rising to create jobs for the unemployed and maintain support for economic reform.
.
.
For all the progress of China's reforms, private enterprise still accounts for less than one-third of
its GDP. China's state banks still are making massive loans to struggling state firms, the sector
of the economy least likely to succeed. In other words, China cannot maintain stability or ensure
prosperity by maintaining the status quo.
What does this mean for us? As the President said when· Premier Zhu Rongji visited Washington
last year, "if we've learned anything in the last few years from Japan's long recession and
Russia's current economic troubles, it is that the weaknesses of great nations can pose as big a
challenge to America as their strengths." So as we focus on the potential challenges that a strong
China could present to the United States in the future, let us not forget the risks that could be
posed by a weak China, beset by internal conflicts, social dislocation, criminal activity, and
large-scale illegal emigration -- a vast zone of instability in Asia.
Our interest lies in encouraging both stability and change in China by encouraging it to meet, not
stifle, the growing demands of its people for openness, accountability, freedom and reform.
Bringing China into the WTO will help in three ways.
�5
First, this is not just an agreement to expand trade between our two countries. It will obligate
China to deepen its market reforms and open its economy to the world. It will increase the pace
ofchange in China.
China's top leaders understand that economic change is both essential and risky. It is risky
because opening China's antiquated economy to global competition is likely to cause more
short-term unemployment and the specter of social unrest. But, interestingly, they also
understand that this change is essential because China cannot make the next leap in development
without world-class industries and products that can compete in the global economy. And the
orily way to produce competitive industries is to open the country to outside competition. With
this WTO agreement, they have chosen to continue opening their economy, despite the risks that
path entails. Do we really want to reject that choice?
The introduction ofcompetition results in natural pressure for progress. A decade ago, China's
best and brightest college graduates sought jobs in the government, in large state-owned firms or
state-run research institutions or universities. More and more, the best and brightest either are
starting their own companies or choosing to work for foreign-invested companies --where they
generally get higher pay, a !Jetter work environment, and a chance to get ahead based on merit,
not political connections.
U.S. companies are the leaders in the Chinese market in developing human resources-- by
emphasizing teamwork and respect for individual rights. In turn, more and more, Chinese firms
are learning that unless they change their working style and treat employees with respect, they
will lose out in the competition for top talent. This process will only accelerate as China joins
the WTO, and we should do all we can to encourage it, because it will lift the standards of
Chinese workers -- and their expectations.
Second, by accelerating economic change, the agreement we reached also has the potential to
encourage China to evolve into a more open society.
In ways that are incomplete, but nonetheless real for millions of ordinary Chinese citizens,
China's economic opening already has given its people greater scope to live their lives. Take
Shanghai, for example, the city that has been most open to international influence. Ten years
ago, people in China did not own their own homes. Today, 25 percent of Shanghai residents are
homeowners. When reforms began; there were no supermarkets, and citizens had to buy food
from state-run outlets using coupons. Today, there are more than 1,000 supermarkets and no
more rationing of food. A decade ago, Chinese citizens could rarely travel in or out of their own
country. Last year, on New Year's Day, airlines added more than 250 flights to international
destinations from Shanghai alone. Nationwide, China has seen the emergence of more than one·
million nonprofit and social organizations -- professional associations, consumer groups, tenant
organizations, environmental groups; a 2,500 percent explosion of print and broadcast media;
and local elections in the vast majority of the country's 900,000 villages.
Let us understand: these changes do not mean that the people of China enjoy political freedom.
Chinese authorities still tolerate no organized political dissent or opposition, and no challenge to
the Communist Party. Over the past year, we have see an increase in its crackdown on political
activities and dissent; stepped-up controls on unregistered churches; the suppression of ethnic
�..
6
minority groups, especially Tibetans; and the imprisonment of even more dissidents whose only
crime is free speech. Because the Communist Party's ideology has largely been discredited in
China, and because it lacks the legitimacy that can only come from democratic choice, it seeks to
maintain its grip by suppressing other voices.
So let me make very clear: This agreement is not, by itself, a human rights policy for the United
States. We must and we will continue to speak out on behalf of people in China who are
persecuted for their political and religious beliefs. That is why we pushed for the release of
Dickinson College librarian Song Yongyi, who was released just last week. That's why we
sanctioned China as a "country of particular concern" under the International Religious Freedom
Act last year. That's why we sponsored a resolution last year in the UN Human Rights
Commission condemning China's human rights record and why we're doing it again this year.
We will continue to press China to respect global norms on non-proliferation; to encourage a
peaceful resolution of issues with Taiwan; to urge China to be part of the solution to the problem
of global climate change.
With or without this WTO agreement, we will need to continue to work in all these areas. At the
same time, I believe this agreement will reinforce and complement these efforts, and help move
China in the right direction in fundamental ways.
For example, in the past, the Chinese state was every citizens' employer, landlord, shopkeeper,
and news provider all rolled into one. By advan.cing privatization, this agreement will accelerate
a process that is removing government from vast areas of people's lives.
By giving investors and property owners predictability.and protection against arbitrary
government action, it reinforces the idea that individuals have rights. This will give added
impetus to those trying to strengthen the Chinese legal system in a way that allows citizens to
hold their government truly accountable.
Finally, by opening China's telecomriuinications market to cutting-edge American technology
and international firms, the WTO agreement will help bring the information revolution to cities
and towns across China. A year ago, China had two million Internet addresses. Today, it has
nine million. Soon, people in some of the most remote villages in interior China will have access
to CNN. And as they become more mobile, more prosperous, and more aware of alternative
ways of life, I believe they will seek a stronger voice in shaping their destiny.
Of course, just last week, Beijing announced that it was cracking down on the Internet. It's
outrageous-- but it's also futile. In-this information age, cracking down on the Internet is like
King Canute trying to still the waters. Indeed, the fact that the Chinese government is pushing
back against the increasing flow of information to the Chinese people only proves that the
changes China is undergoing are real and threatening to the status quo. This kind of repression
is not an argument for slowing down the effort to bring China into the world; it's an argument
for accelerating it.
In the end, as China opens to the information economy, it can succeed only as it liberates the
minds of its people and empowers the individual. In this age, you cannot expect people to be
creative economically and frozen politically. At the same time, China may discover that people
are far more willing to tolerate wrenching economic change when they have a say in the
�7
decisions that affect their lives. Compare the fates of the governments of an autocratic Indonesia
and a democratic South Korea as they faced the Asian financial crisis o~er the past two years.
Bringing China i~to the WTO doesn't guarantee it will make the right choice for political
reform. But by accelerating the process of economic change, it will force China to confront that
choice sooner, and make the imperative for that choice far more powerful.
How will China change? I believe it will be a combination of internal pressures for a greater
voice and external valida,tion of the human rights struggle by the internatiomil community. The
WTO agreement will bolster the former while we maintain our leadership role in the latter. Our
policy should no more be measured week to week or year to year than you could have measured
our policy toward the Soviet Union --with which we continued to engage, even though it posed
a much greater threat to us than China does today.
This agreement will advance our national security interests in a third way as well: 1t mcreases
the chance that in the new century China will be on the inside of the international system,
playing by the rules, instead of on the outside, denying them.
Under the terms of this agreement, the Chinese government is obliged to publish laws and
regulations. It subjects some of its most important decisions, for the first time, to the review of
an international body. Why does that matter?
Quite simply, it applies to China the basic principle at the heart of the concept of the rule of law:
that governments cannot behave arbitrarily at home or abroad, that their actions are subject to
rules consistently applied. Remember, China is choosing to embrace these obligations. As
China becomes a stakeholder in the WTO and other internation~l regimes, it will be more likely
to accept the legitimacy of international norms, and define its future within the international
community, not outside of it.
I know some say that if China is allowed to join the WTO, it actually will undermine our effort
to strengthen global norms in two very important areas: labor rights and the environment. But
the fact is, most of the members of the WTO already are developing countries, with the same
concerns that trading rules not become an instrument to restrict their growth. China's
membership won't change that equation. And considering the fact that China is home to onefifth of the world's people and the source of a rising share of greenhouse gas emissions, it is hard
to imagine an effective global effort to meet those environmental challenges without China.
It's fair to ask: how do we know China will do what it promised to do in the agreement we
· signed? Of course, we cannot know for sure. But we do have reasons to believe that it will, and
mechanisms to reinforce that.
First, China is pledging to open its. economy and its markets .not just as a means of getting in the
WTO, but because most of its leaders believe reform is in China's interest.
Second, as a member of the WTO, non-compliance by China is subject to dispute resolution
under the WTO; like any other country, China will confront judgments backed by a 13 5member body, rather than being able to chalk up friction to-supposed U.S. bullying. Right now,
if China treats our products unfairly, we have no recourse, short of pulling the plug on trade.
�8
This agreement increases our leverage with China in the event of a future trade dispute. If China
does not comply with adverse rulings by the WTO,. we are entitled to take equivalent action
against China.
·
In the end, we must and will continue to protect our interests with firmness and candor. But we
must do so without isolating China from the global forces that can empower its people to build a
better future. That would leave the Chinese people with less access to infomiation, less contact
with the democratic world, and more resistance from their government to outside influence and
ideas. No one could possibly benefit from that except for the most rigid, anti-democratic
elements in China itself. Let's not give them a victory by locking China out of the WTO.
The question is not whether or not this trade agreement by itself will cure serious and disturbing
issues of economic and political freedom in China; the issue is whether it will push things in the
right direction. President Clinton believes it will. Some of the most courageous proponents of
change in China agree. Martin Lee, leader of Hong Kong's Democratic Party, says that without
entry to the WTO, "any hope for the political and reform process would also recede." And
Chinese dissident Ren Wanding said upon the deal's completion: "Before, the sky was black.
now it is light. This can be a new beginning."
It is our shared conviction that supporting this agreement is a new begimiing. It is the right thing
for America, for China, for Asia, and for the world. It will increase the chance that China will
define its future within the international community, and move toward a more open society that
upholds the rule of law. That is what is at stake in this debate. Let us have the wisdom to
choose wisely. Thank you.
###
�
Dublin Core
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Title
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Speechwriting Office - Paul Orzulak
Creator
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National Security Council
Speechwriting Office
Paul Orzulak
Date
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1999-2000
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<a href="http://clinton.presidentiallibraries.us/items/show/36267" target="_blank">Collection Finding Aid</a>
<a href="http://catalog.archives.gov/id/7585791" target="_blank">National Archives Catalog Description</a>
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2008-0702-F
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<p>Orzulak served as speechwriter for President William J. Clinton and National Security Advisor Samuel R. Berger in 1999 and 2000.</p>
<p>Orzulak authored speeches for President Clinton concerning permanent normal trade relations with China; the United States Coast Guard Academy commencement; the role of computer technology in India; the defense of American cyberspace; the Eleanor Roosevelt Human Rights Award; the memorial service for Former Prime Minister Keizo Obuchi of Japan; the Charlemagne Prize in Germany; the presentation of the Medal of Freedom to President James E. Carter and Rosalyn Carter in Atlanta; the Millennium Around the World Celebration in Washington, DC; the Cornerstone of Peace Park in Japan; the role of scientific research and the European Union while in Portugal; sustainable development in India; armed forces training on Vieques Island, Puerto Rico; and the funeral services for Admiral Elmo R. Zumwalt, Jr. in Annapolis. Orzulak’s speechwriting for National Security Advisor Berger concerned Senator Joseph R. Biden, China’s trade status, Kosovo, and challenges facing American foreign policy.</p>
<p>This collection was made available through a <a href="http://clinton.presidentiallibraries.us/freedom-of-information-act-requests">Freedom of Information Act</a> request. For more information concerning this collection view the complete finding aid.</p>
Provenance
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Clinton Presidential Records: White House Staff and Office Files
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Clinton Presidential Library & Museum
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Adobe Acrobat Document
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82 folders in 7 boxes
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Paper
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China [Folder 1] [4]
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National Security Council
Speechwriting Office
Paul Orzulak
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2008-0702-F
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Box 1
<a href="http://clintonlibrary.gov/assets/Documents/Finding-Aids/2008/2008-0702-F.pdf" target="_blank">Collection Finding Aid</a>
<a href="http://catalog.archives.gov/id/7585791" target="_blank">National Archives Catalog Description</a>
Provenance
A statement of any changes in ownership and custody of the resource since its creation that are significant for its authenticity, integrity, and interpretation. The statement may include a description of any changes successive custodians made to the resource.
Clinton Presidential Records: White House Staff and Office Files
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Adobe Acrobat Document
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Clinton Presidential Library & Museum
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Reproduction-Reference
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5/19/2014
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42-t-7585791-20080702f-001-007-2014
7585791