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. Last Updated: 07/27/2016

U.S., China Sign Pact To Accelerate Trade

BEIJING -- The United States and China on Monday signed a broad agreement aimed at expanding trade and investment, though many of the details remain to be discussed.


The agreement, signed by U.S. Commerce Secretary Ron Brown and Chinese Foreign Trade Minister Wu Yi, was actually a promise to set up future meetings focusing on 14 areas -- including telecommunications, aviation, the automotive industry and the environment.


The agreement also provides for future discussion about U.S. training of Chinese managers and assistance in improving commercial law in China.


In remarks at the signing ceremony, Brown emphasized that the agreement was meant to create a longterm trade and investment relationship. He said its most important goal would be to raise the standard of living in both countries.


Brown arrived in Beijing on Saturday with 24 executives of large U.S. corporations for talks the Chinese are hailing as a fresh start for U.S.-China trade. The eight-day mission also will include stops in Shanghai, Canton and in Hong Kong.


On Monday, Brown also met with Premier Li Peng and will meet tomorrow with President Jiang Zemin.


He is the first Cabinet-level official to visit since President Bill Clinton's decision in May to separate the issue of normal trade ties from China's human rights practices.


A senior U.S. government official said Brown raised human rights privately with Li and other Chinese leaders, but would not elaborate on what was said.


On his preferred topic, however, Brown minced no words in his declaration that Washington plans to provide concerted and effective support for U.S. firms handicapped by restrictions on doing business in China.


"I don't want a level playing field," Brown said, using a phrase most often heard in U.S. trade talks with Japan. "I want a tilted playing field."


Brown said the tilt would come not from unfair advantages, but from easing restrictions on soft loans, export controls and other limits on business with China that have long been linked to political disagreements with the ruling Communist Party.


China's growing trade surplus with the United States -- at $23 billion in 1993 second only to Japan -- has given Washington added incentive to concentrate on economic, rather than political, issues.


"The United States government is now playing an activist role on your behalf and we plan to turn up the heat," Brown told a gathering of U.S. business executives. "We are not ideological or philosophical about this. We are relentlessly pragmatic. Bottom-line oriented."


U.S. executives here complain that companies from other major nations, such as Japan, France and Germany, have had an unfair advantage because of support from their own governments, particularly in the form of concessionary loans for foreign-aid projects. "The question is not, 'what is wrong with China?' but 'how do we manage?" said Charles A. Hamrick, executive vice president of the American Chamber of Commerce in Beijing. The executives traveling with Brown, some from major U.S. firms such as Chrysler and Bell Atlantic Corp., are hoping to clinch deals worth several billions of dollars.


Brown said that some $25 billion dollars in projects would be at stake in the next few years and that almost 10 times that amount in infrastructure projects was in the pipeline.


He also promised to continue to lobby Congress to ease restrictions on export controls and to push for Export-Import Bank financing for investments in China.


Ex-Im Bank loans, at below-market rates, are considered essential to the profitability of projects in countries like China because of costly local government regulations, limits on repatriation of profits and tax rules.