China: WTO Accession and Permanent Normal Trade Relations (PNTR)Fact sheet released by the Bureau of Public Affairs
U.S. Department of State, May 24, 2000
The U.S. House of Representatives passed legislation to grant Permanent Normal Trade Relations with China (PNTR) on May 24, 2000. Secretary of State Madeleine Albright has called the House vote "the right decision for America." The Senate will vote on similar legislation in June, and as President Clinton has stated, if the Senate votes as the House has done, "it will open new doors of trade for America and new hope for change in China."
China has been negotiating for the past thirteen years to gain entry into the World Trade Organization (WTO). On November 15, 1999, the U.S. and China reached a bilateral accession agreement that will result in a dramatic opening of the China market to U.S. goods and services once China joins the WTO. This agreement will require no new market opening steps by the U.S. Instead, the U.S. will simply maintain the market access policies we currently apply. The U.S. has granted China Normal Trade Relations (NTR) status every year on an annual basis since 1980, under so-called Jackson-Vanik waiver provisions (which relate to freedom of emigration) of U.S. trade law.
The accession agreement negotiated with China will benefit American business, workers, and farmers by slashing industrial and agricultural tariffs and opening up sectors across the board to foreign competition. At the same time, the agreement will enhance our ability to ensure fair trade and to protect against import surges and unfair pricing. In addition, China will be subject to strong, new, WTO enforcement mechanisms to ensure that it lives up to the commitments it has made. The agreement will help promote reform in China, stability in the Asia-Pacific region, and advance American national security interests.
But we will only be able to gain these benefits if Congress enacts unconditional, permanent, Normal Trade Relations (PNTR), as required by WTO principles. Subjecting one WTO member to annual review of its NTR status -- whether tied to specific emigration-related conditions or not -- is clearly discriminatory.
If Congress were to refuse to grant PNTR, our competitors in Europe and Asia would reap benefits negotiated by the U.S., but American businesses and farmers would lose the full benefit of the market opening concessions China made as well as protections against unfair trade practices.
China's accession to the WTO and the terms of the U.S.-PRC agreement will encourage reform in China. China will have to make its trade regime consistent with its WTO obligations. This will lead to a deepening of its market reforms; leaders who want their country to move further and faster toward economic freedom will be empowered. China will be exposed to global competition and increased pressure to expand the role of the market, even in its state-owned enterprise system. Chinese and foreign businessmen in China will gain greater economic freedom, and the process of removing government from vast areas of China's economic life will be accelerated. Opening of China's telecommunications market, including to Internet and satellite services, will over time expose the Chinese people to information, ideas, and debate from around the world. This process will also strengthen the rule of law in China, as the government will be obliged to publish laws and regulations, and its decisions in pertinent areas will be subject to international review.
Bringing China into international agreements and institutions that can make it a more constructive player in the world, with a stake in preserving peace and stability, will advance our larger interests and those of our friends in Hong Kong, Taiwan and elsewhere. Better U.S.-PRC relations will make China more inclined to cooperate with the U.S. on a broad range of issues, including non-proliferation, regional security, peacekeeping, arms control, the environment, and human rights. On the other hand, rejection of PNTR by the Congress -- a decision that would have no economic rationale evident to the PRC -- will weaken economic reformers in China, and be seen by Chinese leaders as reflecting a decision by the U.S. to adopt an adversarial stance. It would also strengthen those in that country who seek to confront the U.S. abroad, and thus undercut U.S. interests in the region and around the world.
As Secretary Albright has stated, engagement with China does not mean endorsement. The U.S. will continue to vigorously press our serious concerns about human rights and religious freedoms there, both bilaterally and internationally, as we did recently at the meeting of the UN Human Rights Commission in Geneva and in designating China a country of particular concern under the International Religious Freedom Act. China's accession to the WTO and our related move to enact PNTR will strengthen forces in China likely to move the human rights situation in the right direction. On the other hand, rejection of PNTR will do nothing to enhance human rights in China.
Accountability, transparency, responsibility and inclusion in a rules-based trading system are key to moving China in the right direction on everything from human rights to non-proliferation. PNTR will cost the American people nothing. Our market already is open to Chinese products, while this agreement will open China's market to us. As the President has said, if this were a game, the final score would be 100-0 in favor of the United States.
[End of Document]
Link to Secretary Albright's May 24, 2000 statement.
Link to President Clinton's May 24, 2000 statement.
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