CONFIDENTIAL
MAB 091/2
22 MAY 1992
ма
minili
Mr
Mr Ricketts
PS/Mr Goodlad
PS/MY
FROM: T Furness
Hong Kong Department
DATE: 21 May 1992
Mr Fungers
cc: Mr Burns
Aug 2215.
26
US/CHINA RELATIONS: MOST FAVOURED NATION STATUS
1.
The Minister may wish to have a note on the current position regarding China's Most Favoured Nation status (MFN) in the United States before his visit to Hong Kong.
2.
The US's foreign trade policy towards China under MFN enables the latter's imports into the US, to be exempt from punitive tariffs. MFN is a GATT related concept and allows China (a non-GATT member) to enjoy the same import tariff rates on its exports to the US as any GATT member.
3.
A decision on the renewal of MFN has to be taken by the President annually by 3 June in each year. Since Tiananmen there has been stiff resistance to renewal both in the
Senate and the House of Representatives because of China's performance in a number of areas including human rights, intellectual property, and non-proliferation. The Senate
and House have tried both to overturn renewal and to attach
conditions to renewal. The President's decision on renewal
can be challenged in either House or Senate by a two thirds majority vote. In the past we have lobbied at the highest
NESADD/1
JRB
CONFIDENTIAE