The New York Times

Tuesday, March 14, 2000

White House to Publish Accord on China's Entry Into W.T.O.

By JOSEPH KAHN with CRAIG S. SMITH

WASHINGTON, March 13 -- Bowing to pressure from Congress, the Clinton administration plans to release the text of the agreement it negotiated on China's entry to the World Trade Organization, as early as Tuesday.

That reverses a decision to keep the accord classified until China completed talks with other countries.

Both Republican and Democratic lawmakers demanded that the administration release the agreement, which has been under wraps since it was signed in November, because they say Congress cannot vote on whether to grant China permanent normal trade relations while the W.T.O. agreement remains secret. As part of that accord, the administration asked Congress to give up its annual review of China's trade rights in this country.

The vote on permanent normal trade relations is one of Mr. Clinton's top foreign policy priorities, administration officials have said. Mr. Clinton argues that it is a strategic imperative to get China into the World Trade Organization, where it would be subject to the trading rules that most other nations follow. He has also said that freer trade supports the drive for economic openness in the Communist country.

But the agreement has sparked a legislative battle in Congress. Opponents argue that China does not deserve permanent normal trade relations because it violates human rights standards and continues to threaten the use of force against Taiwan, which China regards as a rebellious province. The Senate looks set to grant normal trading rights, but the vote in the House is still up for grabs, Congressional leaders and administration officials said.

"We are taking away an unreal issue and responding to the concerns of some members who wanted to see this agreement and share it," said Commerce Secretary William M. Daley, who is leading the campaign to persuade Congress to grant permanent normal trade relations. "We are just going to get it out there and everyone will see that it confirms what we have been saying -- this is a great deal for the United States."

The pressure on Congress to vote on the matter also increased today when China vowed to join the trade organization, regardless of what the United States does. If Congress were to deny permanent normal trade relations, and China were to join the world group anyway, Beijing could potentially offer other countries more access to its market than American companies would get.

Until now, China had indicated that it would not join the W.T.O. if it was not freed from the annual review. But, apparently sensing that such a declaration gave Congress the leeway to deny China the rights, without incurring any damage to American companies, Beijing signaled that it would pursue entry anyway.

Permanent trade relations affect bilateral ties, said Shi Guangsheng, China's minister of foreign trade. "It will be up to W.T.O. members to decide" whether China enters the global trade body, he said.

Some members of Congress and executives who have security clearances have been allowed to view the full text. But the administration agreed to China's request to delay releasing it to the general public. That fueled suspicions among some opponents that the accord was not as favorable to United States interests as the administration claimed.

Adding to the sensitivity of releasing the text, the White House enraged China in April when it released onto the Internet the negotiating text of the trade agreement even after Mr. Clinton decided not to close the deal at that time. The administration hoped to try to keep China from backtracking in negotiations. But the release was seen as a blow to Prime Minister Zhu Rongji, who came in for heated criticism domestically for concessions he made.

Clinton administration officials said they agreed to keep the agreement secret because China did not want Europe, Mexico and some 20 other countries that had yet to complete their own bilateral negotiations on China's entry to the trade body to try to one-up the United States. Administration officials said they also did not want extended haggling by other countries to delay China's admission to the trade body.

The administration argues that it has disclosed all the relevant contents of the agreement. But it has only released the headline concessions China made, not the full text.

The full text contains 250 pages of detailed legal language on tariffs, quotas and market access for some 5,000 types of goods and services, administration officials said.

Among the highlights, the pact allows foreign companies to own 49 percent of Chinese telecommunications companies once China joins the W.T.O., a level rising to 50 percent after two years. Foreign banks will be allowed to conduct local-currency business with Chinese enterprises two years after China enters. China will cut the tariffs it imposes on cars to 25 percent from 80 percent or higher by 2006.

China also agreed to raise quotas and lower tariffs on wheat, corn, rice and cotton, products in which the United States is thought to have a substantial comparative advantage.