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CHINESE MADE MORE PROGRESS IN THIS AREA. THERE HAD BEEN SOME ENCOURAGING SIGNS, FOR EXAMPLE, CHINA'S PARTICIPATION IN THE MIDDLE EAST ARMS CONTROL INITIATIVE, AND RECENT INDICATIONS FROM PEKING THAT THE GOVERNMENT WAS REVIEWING ITS POLICY TOWARDS NTCR AND NPT.
4. ON TRADE, THE LETTER SAID THE ADMINISTRATION HAD SOUGHT TO IMPROVE AMERICAN ACCESS TO CHINA'S MARKETPLACE, TO BOLSTER CHINESE PROTECTION OF INTELLECTUAL PROPERTY, TO END FRAUDULENT PRACTICES BY
CHINESE TEXTILE EXPORTERS, TO INDUCE PEKING TO UNDERTAKE THE ECONOMIC AND TRADE REFORMS REQUIRED FOR MEMBERSHIP OF GATT. IT EMPHASISED THAT MEN WAS IMPORTANT IN MAINTAINING THE
ADMINISTRATION'S ABILITY TO HOLD CONSTRUCTIVE NEGOTIATIONS WITH THE CHINESE. IT NOTED THAT THERE HAD BEEN A NUMBER OF CONCERNS, OVER THE LAST THREE YEARS, ABOUT CHINESE TRADE PRACTICES, WHICH HAD BECOME MORE PROTECTIONIST. THE ADMINISTRATION PRESSED THE CHINESE TO ADDRESS THESE CONCERNS. A FURTHER ROUND OF BILATERAL NEGOTIATIONS ON MARKET ACCESS WAS SCHEDULED FOR AUGUST. IF THIS PROVED UNSUCCESSFUL, THE ADMINISTRATION WOULD INITIATE SECTION 301 ACTION AGAINST CHINA. A SECTION 301 INVESTIGATION HAD ALREADY BEEN
INITIATED IN CONNECTION WITH AMERICAN CONCERNS ABOUT INADEQUATE PROTECTION OF INTELLECTUAL PROPERTY RIGHTS IN CHINA. IF THE CONSULTATIONS FAILED TO PRODUCE PROGRESS, THE ADMINISTRATION WOULD TAKE RETALIATORY ACTION.
5.
THE ADMINISTRATION HAD PRESSED THE CHINESE ON CASES OF CHINESE
TEXTILE TRANS-SHIPMENTS THROUGH THIRD COUNTRIES (AS A WAY OF
AVOIDING QUOTA RESTRICTIONS). THE CHINESE SEEMED PREPARED TO TAKE
ACTION TO CURTAIL THIS.
6. ON THE EXPORT OF GOODS MANUFACTURED BY FORCED LABOUR, THE ADMINISTRATION PROPOSE TO NEGOTIATE A MEMORANDUM OF UNDERSTANDING
WITH CHINA ON PROCEDURES FOR THE PROMPT INVESTIGATION OF SUCH CASES. PENDING NEGOTIATION OF THE MOU, US CUSTOMS WOULD TEMPORARILY EMBARGO SPECIFIC PRODUCTS FROM CHINA IF THERE WAS REASONABLE INDICATION THAT THEY WERE MADE BY PRISON LABOUR.
7.
THE LETTER REITERATED FIRM AMERICAN SUPPORT FOR TAIWANESE ACCESSION TO GATT ON TERMS ACCEPTABLE TO GATT CONTRACTING
PARTIES. IT SAID THE ADMINISTRATION WOULD BEGIN TO WORK ACTIVELY WITH OTHER PARTIES TO RESOLVE THE ISSUES RELATING TO TAIWAN'S GATT
ACCESSION. THEY WOULD ALSO PRESS THE CHINESE TO IMPLEMENT TRADE REFORM SO THAT CHINA'S GATT APPLICATION COULD BE ADVANCED. THE LETTER ADDED THAT AMERICAN SUPPORT FOR QUOTE TAIWAN'S ACCESSION TO
GATT AS A CUSTOMS TERRITORY UNQUOTE SHOULD IN NO WAY BE INTERPRETED
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