Money means more than security: Business backs Clinton on China

U.S. business leaders and White House officials said Wednesday they hoped to convince Congress that maintaining trade ties with China was important despite allegations that Beijing stole U.S. nuclear secrets.

The business community is laying the groundwork for what is expected to be a heated debate in Congress over U.S.-China relations after President Clinton Thursday tells lawmakers he intends to renew China's trade privileges for another year.

Last year, the United states bought $57 billion more in goods from China than the Chinese bought from Washington.

``We think there is a strong case to be made for continued engagement with China,'' National Association of Manufacturers (NAM) President Jerry Jasinowski told reporters Wednesday.

The group, which represents 14,000 companies, mostly small and medium-sized, has already been making its case to lawmakers for continued trade ties with China. Jasinowski said the group may resort to advertising in some key Congressional districts. But the group will mostly rely on direct contacts between local business leaders and members of Congress to get their message across, he said.

Congress will have 90 days to overturn Clinton's decision to renew what is now called Normal Trade Relations (NTR), formerly Most Favored Nation (MFN). The trade status gives China the same low-tariff access to U.S. markets enjoyed by nearly every other country. Without it, duties on imports from China would jump to an average of about 44 percent from a current level of about 6 percent.

The spying allegations outlined in the Cox report, which also described an aggressive effort by China to obtain U.S. technology, has cast a pall over U.S.-Sino relations already darkened by NATO's accidental bombing of the Chinese embassy in Belgrade and angry protests against Americans in Beijing.

A White House official said Clinton will use many of the arguments put forward by the business community -- that trade with China supports U.S. jobs, strengthens the global economy and promotes social change in China.

The official sought to make the case that alleged Chinese nuclear espionage -- outlined in a report released last week by a special Congressional panel headed by Rep. Christopher Cox, a California Republican -- while a serious matter, should not obscure the importance of maintaining trade ties with China.

``This is not a favor. Trade with China has tripled over the last decade and supports hundreds of thousands of American jobs,'' said the official, who asked not to be identified. ''Trade helps to bring about social change in China and to maintain stability and growth there.''

With labor unions, a key Democratic support group, opposed to normal trade ties with China because of its human rights record, the White House will have to rely heavily on the business' ability to win support from Republicans who control Congress.

Some analysts expect Clinton to win the fight over annual renewal of China's trade status. But it will set the stage for an even more difficult fight possibly later this year over ending the annual trade debate and giving China permanent NTR as part of its bid to join the World Trade Organization (WTO). Whether that battle takes place depends largely on whether the United States and China can complete a trade deal that would clear the way for U.S. support for China's WTO membership.

Negotiators came close to striking a deal, but talks were put on hold after the Belgrade embassy bombing. Negotiations are not expected to resume until after the United States completes an investigation of the bombing and explains to Beijing how it happened, U.S. officials said.

China has demanded an explanation and punishment of people responsible for the mistaken bombing.