[Congressional Record Volume 146, Number 34 (Thursday, March 23, 2000)]
[Senate]
[Pages S1671-S1673]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ROTH (for himself and Mr. Moynihan):
  S. 2277. A bill to terminate the application of title IV of the Trade 
Act of 1974 with respect to the People's Republic of China.


  permanent normal trade relations with the people's republic of china

  Mr. ROTH. Mr. President, I rise today for myself and Senator Moynihan 
to introduce legislation that will make normal trade relations with the 
People's Republic of China permanent when China accedes to the World 
Trade Organization. The legislation I am introducing is the same as 
that sent up by the administration. It is a clean bill, and I believe 
we should keep it that way.
  Last year, the Chinese made a series of bold commitments to United 
States negotiators to open their market in return for WTO accession. In 
sector after

[[Page S1672]]

sector--and by a date certain--the Chinese have pledged to open their 
markets to foreign goods, investment and services. These openings 
represent an unparalleled opportunity for U.S. farmers, manufacturers, 
and service providers to expand their exports into a rapidly growing 
market.
  Those commitments will help move the Chinese economy toward a rules-
based system and end many forms of state control. In essence, China has 
conceded that its future depends on the replacement of its communist-
style economy with an open, market-oriented system based on the rule of 
law. Indeed, in a number of sectors, economically backward China will 
be more open to American exports than some of our developed-country 
trading partners in Asia and Europe.
  What must the United States give away in terms of access to our 
market in return for China's pledge to enact these sweeping reforms? 
The answer is as striking as it is simple: absolutely nothing. The cost 
of our access to China's market is simply to comply with our own WTO 
obligations. Indeed, for the United States to reap the benefits of 
China's open markets once it joins the WTO, the only act necessary is 
passage of this legislation. This legislation will thus end the annual 
normal trade relations renewal process required by the Jackson-Vanik 
provisions in current trade law.
  Some believe we must retain the annual renewal process because it 
gives us leverage in checking China's conduct on a number of fronts. 
But the annual debate on renewing normal trade relations has not been a 
very effective means of achieving any of the goals we all share with 
respect to China: peaceful settlement of the Taiwan question; enhanced 
human rights, religious freedom and stronger worker rights for the 
Chinese people or curbing China's irresponsible behavior on security 
matters. But the active involvement of United States firms in China can 
only help open that society and reinforce the changes already under way 
in China toward free markets and a rules-based society.
  The enormous benefits of enacting permanent normal trade relations, 
on the other hand, are clear. Just as clear is the huge cost of failing 
to do so. In passing PNTR, American workers, farmers and exporters will 
gain access to market-opening concessions the Chinese made to our 
negotiators after 13 long years of hard negotiations.
  If we fail to pass PNTR, then every member economy of the World Trade 
Organization will gain such access except the United States. Our 
European, Japanese and Asian competitors could not hope for a more 
lucrative gift, and all at the expense of our farmers and workers.
  Here is what Leonard Woodcock, many years the President of the United 
Auto Workers, had to say in support of PNTR 2 weeks ago:

       American labor has a tremendous interest in China's trading 
     on fair terms with the U.S. The agreement we signed with 
     China this past November marks the largest single step ever 
     taken toward achieving that goal. The agreement expands 
     American jobs. And while China already enjoys WTO-based 
     access to our economy, this agreement will open China's 
     economy to unprecedented levels of American exports, many of 
     which are high-quality goods produced by high-paying jobs.

  With that sentiment I most strongly agree.
  What about the rights of Chinese workers themselves? On this point I 
agree with Mr. Woodcock, as well. To be sure, nothing in the U.S.-China 
trade agreement requires that free trade unions be formed in China. Yet 
the WTO does not require this of any of its 136-member countries, and 
the WTO is the wrong instrument to use to achieve that goal. We should, 
instead, be asking a more important question: Are Chinese workers 
better off with this agreement? The answer is a resounding yes.
  With so little to lose in ending the annual renewal process and so 
much to gain by enacting PNTR, I would hope this body will pass this 
legislation overwhelmingly.
  Mr. MOYNIHAN. Mr. President, I rise with enthusiasm to join our 
chairman in introducing this measure which is word for word as the 
President sent to us on March 8. In doing so, he put the matter clearly 
enough. He said:

       The Agreement will dramatically cut import barriers 
     currently imposed on American products and services. It is 
     enforceable and will lock in and expand access to virtually 
     all sectors of China's economy. The Agreement meets the high 
     standards we set in all areas, from creating export 
     opportunities for our businesses, farmers, and working 
     people, to strengthening our guarantees of fair trade.

  I point out, sir, that the negotiations that have led us to this 
point have taken 13 years. They began prior to the creation of the 
World Trade Organization, under its predecessor, the GATT. It has been 
hard slogging, painful, detailed work, but it has come to a conclusion.
  China wants into the WTO, the World Trade Organization. The price is 
to give us access to her markets. She has access to ours; hence, the 
imbalance of our trade, which is enormous just now.
  I say, sir--and I think it would be agreed to--this will be very 
likely the most important legislative decision we have made in a decade 
or will make for a decade. At issue is the opening of American and 
world markets, which followed the calamitous conditions brought about 
by the Smoot-Hawley tariff in 1930. The opening began by Cordell Hull, 
in the form of the reciprocal trade agreements.
  Every President since has expanded and continued this process. You 
see it all around you in unprecedented prosperity in those countries 
which first participated.
  Now China wishes to do so. The condition is that we share in the 
Chinese market. It could not be more simple. We are not giving them 
anything they do not now have. They are giving us the treatment that is 
required by a member of the World Trade Organization.
  Just this morning, the Wall Street Journal reported, in a Wall Street 
Journal/NBC poll, that a solid majority of Democrats--almost 2 to 1--is 
in favor of this legislation. I am hesitant to tell my revered chairman 
that Republicans do not do as well. But on balance, the American people 
sense this. They have had the experience of it for three generations 
now.
  Let's do it.
  We had a fine hearing today. We had wonderful testimony from 
respected scholars on the subject--Merle Goldman from the Fairbanks 
institution--well, from Boston University--Nelson Graham, East Gates 
Ministries International, who is the son of the Rev. Billy Graham, and 
Michael A. Santoro, a professor from Rutgers.
  The case is so clear, it should not be obscured or delayed. It is up 
to us. I think there is going to be another hearing, at least. I 
believe it is the intention of the chairman to have a legislative 
markup and, as we say, actually reporting out a bill in about a month's 
time.
  Mr. ROTH. I say to the distinguished leader, it is my intent to bring 
this up at least within a month.
  Mr. MOYNIHAN. At least within a month.
  Mr. ROTH. I think the sooner we can move on it, the better off we 
are. I expect this legislation to be adopted with overwhelming 
bipartisan support.
  Mr. MOYNIHAN. Exactly so. It should. I do not think we can name it 
for you, but it certainly will be one of the great measures you have 
achieved in a long career, not yet concluded. I would observe that it 
took some prodding to get the legislation sent up to us. In his State 
of the Union Address on January 27, 2000, the President called upon 
Congress to pass legislation authorizing PNTR for China ``as soon as 
possible this year.'' It took almost two months to get the 
Administration to produce a draft of the legislation, which the 
President formally transmitted to Congress on March 8.

  But we have it now, and the President is fully committed to this, and 
we ought to move swiftly.
  I want to clarify one important point: passage of this legislation 
will not determine whether China enters the WTO. China will enter the 
WTO regardless of Congress' action with respect to PNTR. But until we 
grant China PNTR, we cannot enter in to a full WTO relationship with 
China, which means that we cannot reap the full benefits of the trade 
agreement.
  This is because the WTO--under the General Agreement on Tariffs and 
Trade 1994, the General Agreement on Trade in Services and the 
Agreement on Trade-Related Aspects of Intellectual Property Rights--
requires that WTO members grant each other immediate and unconditional 
normal trading

[[Page S1673]]

relations status. We do not do so now with respect to China.
  China's trade status is conditioned on an annual review of China's 
compliance with the so-called Jackson-Vanik freedom-of-emigration 
provisions of the Trade Act of 1974. The President makes a 
determination by the third of June each year, which is then subject to 
review by the Congress. Because of this conditionality, the trade 
treatment that we currently accord China is insufficient under WTO 
rules. Until we grant China PNTR, we must invoke the WTO's so-called 
``non-application'' provision--that is, Article XIII of the Agreement 
Establishing the World Trade Organization--meaning that WTO benefits 
will not apply.
  Simply put, we must grant China permanent normal trade relations 
status in order to reap the benefits that the United States, its 
workers and its companies will gain from China's entry into the WTO. 
And we ought to do so promptly.
  Mr. ROTH. Mr. President, I ask unanimous consent that the legislation 
be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2277

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. TERMINATION OF APPLICATION OF TITLE IV OF THE 
                   TRADE ACT OF 1974 TO THE PEOPLE'S REPUBLIC OF 
                   CHINA (CHINA).

       (a) Presidential Determinations and Extension of 
     Nondiscriminatory Treatment.--Notwithstanding any provision 
     of title IV of the Trade Act of 1974 (19 U.S.C. 2431 et 
     seq.), the President may--
       (1) determine that such title should no longer apply to 
     China; and
       (2) after making a determination under paragraph (1) with 
     respect to China, proclaim the extension of nondiscriminatory 
     treatment (normal trade relations treatment) to the products 
     of that country.
       (b) China's Accession to the World Trade Organization 
     (``WTO'').--Prior to making the determination provided for in 
     subsection (a)(1) and pursuant to the provisions of section 
     122 of the Uruguay Round Agreements Act (19 U.S.C. 3532), the 
     President shall transmit a report to Congress certifying that 
     the terms and conditions for China's accession to the WTO are 
     at least equivalent to those agreed between the United States 
     and China on November 15, 1999.

     SEC. 2. EFFECTIVE DATES.

       (a) The extension of nondiscriminatory treatment pursuant 
     to section 1(a)(1) shall be effective no earlier than the 
     effective date of China's accession to the WTO.
       (b) On and after the effective date under subsection (a) of 
     the extension of nondiscriminatory treatment to the products 
     of China, title IV of the Trade Act of 1974 shall cease to 
     apply to that country.
                                 ______