MFN Brief 4/93
This view prompted Congress to introduce legislation to fully revoke China's MFN privileges three years ago but each year it has failed to garner enough votes to override the Presidential veto. The Senate passed a similar Bill which was six votes short of a two thirds majority needed to override the President.
A NEW APPROACH.
Last year both houses of Congress once again proposed to condition renewal of MFN status to China based on improvements in trade, weapons proliferation and human rights conditions but this time they approach would be slightly different. Instead of cutting off MFN for all Chinese exports if conditions are not met, tariffs would be selectively imposed on China's state-run industries rather than all exports in general. The strength of this type of proposal is that it keeps engagement with China alive without penalizing the private-sector forces.
CLINTON'S DECISION.
In May of this year, President Bill Clinton will have to decide whether to:
follow President Bush in allowing China unconditional MFN privileges by waiving the Amendment, or
follow the wishes of Congress by targetting the exports of state-run industries with high tariffs.
In his electoral campaign Clinton expressed his intention to impose conditions as suggested by Congress. Since election his resolve does not seem to be so strong.
TSG.UK 4/93
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