2. Bilateral Investment
With China's continuously improved investment environment in recent years,
the U.S. enterprises' enthusiasm to invest in China remains high. In 1998, U.S.
businesses invested in 2,215 projects in China, with the agreed-upon investment
valued at US$6.21billion and the actual inflow of investment valued at US$3.91
billion, which represented an increase of 1.2%, 25.8% and 20.8% respectively
over those in 1997. From January to July 1999, U.S. invested in 1,163 projects
in China, with the agreed-upon investment valued at US$3.49billion and the
actual inflow of investment valued at US$2.22 billion, which represented an
increase of 0.52%, 5.04% and 12% respectively. By the end of July 1999, the
U.S.-invested projects reached a total of 27,744, with the agreed-upon
investment valued at US$49.8billion and the actual inflow of investment valued
at US$23.63 billion. U.S. businesses have invested in such fields as machinery,
metallurgy, petroleum, electronics, telecommunications, chemical industry,
textile, light industries, food agriculture, medicine, real estate as well in
the pilot opening-up sectors of finance, insurances, foreign trade, accounting,
freight transport service, etc. Many U.S. businesses are doing very well in
China and have decided to invest even more in their operations.
3. High-Level Economic and Trade Exchanges
Thanks to the efforts by the two governments and business communities, great
achievements have been made in China-U.S. economic and trade cooperation in
recent years. From late October to early November 1997, President Jiang Zemin
paid a successful state visit to the U.S., giving a strong impetus to the
development of an all-round bilateral relationship, including a sound trade and
economic relationship. In June 1998, during President Bill Clinton's state visit
to China, China and the U.S. had a broad and in-depth discussion on a wide range
of issues, and signed the Agreement on Peaceful Nuclear Cooperation.
In May 1998, the 11th Session of the China-U.S Joint Economic Committee was
held in Washington, D.C. At the meeting, both sides had a thorough discussion on
international and domestic issues of common interest.) In December 1998, the
12th Session of the China -U.S. Joint Committee on Commerce and Trade was held
in Washington, D.C. The two sides exchanged views on a wide range of issues of
common interest and reached a series of agreements on trade and economic
cooperation in various areas. In March 1999, U.S. Secretary of Commerce Dally
led a trans-sectoral infrastructure mission to Beijing, and signed with the
Chinese side several agreements and memoranda. From April 6 to 14, 1999, Premier
Zhu Rongji paid an official visit to the U.S. Premier Zhu and President Clinton
released a joint statement on China's accession to the WTO. Premier Zhu and Vice
President Gore jointly chaired the Second Session of the China-U.S. Forum on
Environment and Development. The two sides also signed a series of protocols and
letters of intention in the areas of agriculture, civil aviation, customs,
energy, environment, etc.
On March 7, 2000, the 13th Session of the China-U.S. Joint Committee on
Commerce and Trade was held in Beijing. Chinese Minister of Foreign Trade and
Economic Cooperation Shi Guangsheng and U.S. Secretary of Commerce William Dally
co-chaired the meeting. The two sides exchanged views on such issues of common
interest as China's Permanent Normal Trade Relations (PNTR) with the U.S.,
China's accession to the WTO, trade and investment, sector cooperation, commerce
law, etc. The two sides issued a joint statement at the conclusion of the
meeting. President Jiang Zemin and Premier Zhu Rongji met with the U.S.
delegation.
On October 27, 2000, the 13th Session of the China-U.S Joint Economic
Committee was held in Washington, D.C. Chinese Minister of Finance Xiang
Huaicheng and U.S. Secretary of Treasury Lawrence Summers co-chaired the
meeting. The two sides had a discussion on various issues, such as macro economy
& banking, enforcement of international law, economic structure reform,
regional economic development, among other matters.
4. Bilateral Talks on China's Accession to the WTO
After the U.S. bombing of the Chinese Embassy in Belgrade on May 8,
China-U.S. bilateral talks on China's accession to the WTO was suspended. The
U.S. side repeatedly asked to resume the talks. To that end, President Clinton
wrote to President Jiang expressing the hope to continue the WTO talks.
President Jiang agreed in his return letter. Before the APEC meeting in
Auckland, New Zealand, the two countries resumed contacts on the issue of
China's accession to the WTO. On September 11, President Jiang Zemin and
President Clinton met in the APEC Leaders Informal Meeting in Auckland and
exchanged views on China's accession to the WTO. Shi Guangsheng, Chinese
Minister of Foreign Trade and Economic Cooperation (MOFTEC) and U.S. Trade
Representative Charlene Barshefsky held talks on the WTO issue during the APEC
meeting.
(From November 10 to 15, the Chinese Government Delegation headed by Minister
Shi Guangsheng and the U.S. Government Delegation headed by Ambassador
Barshefsky and Mr. Gene Sperling, Director of the U.S. National Economic
Council, held negotiations in Beijing on China's accession to the WTO. The two
sides singed on November 15 the Bilateral Agreement Between the Government of
China and the Government of the U.S. on China's Accession to the WTO.)
5. Most Favored Nation (MFN) Status
In July 1979, the Chinese Government and the U.S.
Government signed the Agreement on Trade Relations between China and the United
States, which went into effect in February of the following year, enabling the
two sides to give each other MFN status. MFN is a mutually beneficial trade
arrangement between China and the U.S. on none-levy of discriminative custom
duties on each other's exports on reciprocal basis, which has played a positive
role in promoting the bilateral trade relations between the two countries. The
political turmoil in the spring of 1989 made the MFN an outstanding issue in
China-U.S. relations. Some members of the U.S. Congress submited various kinds
of bills each year demanding the members of the removal of the MFN to China or
conditioning its extension. In May 1994, the U.S. Government announced the
delinking of the annual MFN review with the human rights issue. In July 1998,
President Clinton signed the 1998 Reform Act of the U.S. Internal Revenue Agency
. According to this act, the term of the "MFN" was changed to "Normal Trade
Relations" (NTR). In June 3, 1999, President Clinton announced the extension of
China's NTR for another year. On July 27, the U.S. House of Representatives
voted down a bill removing China's NTR by 260 to 170. On July 28, Zhu Bangzao,
spokesman of the Chinese Ministry of Foreign Affairs, said in his comment that
it is wise for the U.S. House of Representatives to vote down the so-called bill
of "cancelling China's NTR" and that the U.S. side should go along with the
trend of the time and solve the issue of China's permanent NTR at an early date
so as to create favorable conditions for the sustained development of China-U.S.
economic and trade relations.