[Senate Hearing 106-877]
[From the U.S. Government Publishing Office]
S. Hrg. 106-877
TAIWAN'S ACCESSION TO THE WTO
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON FOREIGN RELATIONS
UNITED STATES SENATE
ONE HUNDRED SIXTH CONGRESS
SECOND SESSION
__________
SEPTEMBER 6, 2000
__________
Printed for the use of the Committee on Foreign Relations
Available via the World Wide Web: http://www.access.gpo.gov/congress/
senate
U.S. GOVERNMENT PRINTING OFFICE
69-747 CC WASHINGTON : 2001
COMMITTEE ON FOREIGN RELATIONS
JESSE HELMS, North Carolina, Chairman
RICHARD G. LUGAR, Indiana JOSEPH R. BIDEN, Jr., Delaware
CHUCK HAGEL, Nebraska PAUL S. SARBANES, Maryland
GORDON H. SMITH, Oregon CHRISTOPHER J. DODD, Connecticut
ROD GRAMS, Minnesota JOHN F. KERRY, Massachusetts
SAM BROWNBACK, Kansas RUSSELL D. FEINGOLD, Wisconsin
CRAIG THOMAS, Wyoming PAUL D. WELLSTONE, Minnesota
JOHN ASHCROFT, Missouri BARBARA BOXER, California
BILL FRIST, Tennessee ROBERT G. TORRICELLI, New Jersey
LINCOLN D. CHAFEE, Rhode Island
Stephen E. Biegun, Staff Director
Edwin K. Hall, Minority Staff Director
(ii)
C O N T E N T S
----------
Page
Bolton, Hon. John R., former Assistant Secretary of State for
International Organization Affairs............................. 10
Prepared statement........................................... 12
Kyl, Hon. Jon, U.S. Senator from Arizona......................... 3
Prepared statement........................................... 7
(iii)
TAIWAN'S ACCESSION TO THE WTO
----------
WEDNESDAY, SEPTEMBER 6, 2000
U.S. Senate,
Committee on Foreign Relations,
Washington, DC.
The committee met, pursuant to notice, at 10:31 a.m. in
room SD-419, Dirksen Senate Office Building, Hon. Jesse Helms
(chairman of the committee) presiding.
Present: Senators Helms and Thomas.
The Chairman. Good morning. The committee will come to
order. This is one of those days that Senators, all of whom are
required to be two places at one time, and we will have
Senators coming in and out because they have other committee
responsibilities. This is a very busy time of the day, plus
most Senators are standing in line to speak on the WTO matter.
In any case, we are glad to be here, and I would say that
this committee hearing will examine what needs to be done to
ensure that the Republic of China on Taiwan is not excluded
from the World Trade Organization [WTO] by Communist China and/
or its allies.
As is widely known, Communist China has sought repeatedly
to exclude Taiwan from even minimal participation in any and
all international organizations. For example, just this past
May, China once again succeeded in browbeating the rest of the
world's nations into preventing Taiwan from observing at the
annual meeting of the World Health Organization.
Now, for years we have been led to accept the notion that
the World Trade Organization would be different. On repeated
occasions the Chinese Government has made clear, as have the
United States and Taiwan officials, that Beijing would not
object to Taiwan's accession to the WTO as long as Communist
China got into it first. In fact, it has been widely accepted
that the existing so-called gentleman's agreement between
China, Taiwan, and the United States was that Taiwan would
affiliate with WTO immediately after China had done so.
However, as many have learned to expect, Communist China
began to throw a wrench into the works 2 months ago, in July to
be precise, when it floated the notion that Taiwan would be
allowed to join the WTO only--only as a part of mainland China.
Now, this, of course, is unacceptable to Taiwan, and it
should be to the United States as well. After all, in a just
world, and if the WTO were truly a nonpolitical organization,
Taiwan would already have been a member. Taiwan's economy is
radically more advanced than Communist China's. Taiwan has for
years met the major requirements of WTO, and the only
impediment to Taiwan's membership is that the rest of the world
insists on yielding to the wishes of the Communist government
in Beijing to exclude Taiwan. So one would think, given that
Taiwan each year buys billions of dollars more in U.S. goods
than does mainland China, the U.S. Government would feel no
compunction in laying down the law to Beijing on this issue,
and the upcoming Senate debate over permanent normal trade
relations [PNTR] with China gives us all the perfect
opportunity to do so.
I, of course, will never vote to give PNTR to China, but it
seems to me to be entirely reasonable, even from a pro-PNTR
perspective, to take concrete steps to ensure that as we rush
to admit Communist China into the World Trade Organization we
should also bring democratic Taiwan in along with them.
Now, our first witness, the distinguished Senator from
Arizona, Senator Kyl, has a keen interest in this issue, and we
look forward to hearing him after we have heard from the
distinguished Sentor who is to my right, and very few people
are.
Senator Thomas. Thank you, Mr. Chairman. That is a dubious
honor, perhaps. I appreciate it.
I want to thank you so much for holding this hearing. We
are into this whole process of normal trading relationships and
so on, so I think it is appropriate.
I do have some feelings about it, and let me share them
with you. First of all, of course, as chairman of the East
Asian Subcommittee I have always been fully supportive of
Taiwan's admission into the WTO and have consistently
cosponsored legislation to that effect, most recently Senate
Concurrent Resolution 17.
I have also supported the concept that Taiwan's entry be
based solely on the merits of its accession agreement. I do not
believe that Taiwan's accession should be held up just because
the People's Republic of China [PRC] insists that it should
enter the WTO first before Taiwan, after all, a nation's
sovereignty is not a prerequisite for membership in the WTO.
For example, Hong Kong, which is part of China, is a separate
member. Therefore, I do not see how Beijing can reasonably
maintain that admitting Taiwan to the WTO first is somehow an
affront to sovereignty.
Having said that, however, I feel it necessary to address
one of the topics which I have heard discussed before, which
was the potential of an amendment to the China PNTR bill that
might be offered which would ensure that PRC, once it accedes
to the WTO, does not try to block Taiwan's accession. Were such
an amendment offered on the floor I would oppose it, not so
much because I disagree with what the amendment seeks to do,
but because of other factors.
First, any present talk of either Taiwan or China's
accession is premature. Both countries have completed their
bilaterals with us. Taiwan is still engaged in talks with the
WTO working party handling its accession. The PRC still has a
way to go before its accession is imminent.
Second, I have seen absolutely no indication that the PRC
intends to or considers blocking Taiwan's accession. In fact,
their representations to me have been exactly the opposite.
Third, regardless of the relative merits, I, like Senator
Roth, Chairman of the Finance Committee, and many others, am
strongly opposed to adding any amendents to the China PNTR
bill. Any amendment will have only the effect of basically
killing PNTR for this year. Any amendment would require return
to the conference. Once in confernece, it is unlikely the bill
would emerge before we adjourn.
We only have some 20 legislative days left, a full plate of
domestic legislation to deal with, and there would not be time
for a conference on H.R. 4444 and to pass it back to the House
again. It is clear the House fully supports the President's
unamended version, passed 237 to 197, as does the Senate
Finance Committee, as do I. Consequently, as the subcommittee
chairman I will oppose any attempt to amend this particular
bill and hope that we can move forward, and we need to keep in
mind that it is not up to us to deal entirely with WTO
accession. That is something that is done by the group.
So Mr. Chairman, I guess that is my point of view, and I
appreciate your having this hearing.
The Chairman. Thank you, sir.
Our first witness this morning is a truly remarkable United
States Senator. Jon Kyl came to the Senate on the trot, and
ever since he has not ceased to move rapidly in whatever he
undertakes to do, and he does aplenty. He is one of the most
active Senators on our side of the aisle, and probably in the
entire Senate. In any case, I am very devoted to Jon Kyl, and I
appreciate his coming here this morning to offer his testimony.
Senator, you may begin.
STATEMENT OF HON. JON KYL, U.S. SENATOR FROM ARIZONA
Senator Kyl. Thank you, Mr. Chairman, and Senator Thomas.
Senator Thomas and I were just looking at a recent newspaper
column in the anteroom which described the chairman as the
nicest guy in the U.S. Senate, or some phrase such as that, and
I think we would all agree that it is a pleasure both to work
with you, to serve with you and, certainly for me today, to
testify before you, Mr. Chairman.
The Chairman. Thank you.
Senator Kyl. I thank you for the opportunity to testify. I
believe it is very important for the United States to support
Taiwan's entry into the World Trade Organization. First,
because of the economic benefits that its entry would bring.
Second, because of the need to meet our commitments to our
close and longstanding ally. And third, due to our desire to
defend and promote democratic governments, with free markets,
that respect the rule of law and the human rights of their
people.
First, let me discuss the economic importance of Taiwan's
admission. The WTO plays an important role in promoting free
and fair trade. Under the WTO, member countries agree on a set
of rules and principles for trade, which in turn creates a
stable and predictable trade environment. Second, the WTO
provides a mechanism to enforce these rules, including the
procedure for countries to resolve trade disputes. And finally,
the WTO provides a forum for negoiations to reduce trade
barriers worldwide.
Based on its importance to the world economy, Taiwan should
be admitted to the WTO. It has the nineteenth largest economy
and is the fourteenth largest trading nation in the world.
Taiwan's economy is also closely linked to the United States.
It is America's eighth largest trading partner, and it
purchases more American goods than many of our other major
trading partners like Communist China, Australia, and Italy.
U.S. trade with Taiwan should continue to grow. Over 2 years
ago, we signed a bilateral WTO agreement with Taiwan that
included significant reductions in tariffs and other barriers
for exports of a variety of U.S. goods and services, including
agricultural goods, automotive products, and pharmaceuticals.
The admission of Taiwan to the WTO would ensure that market
barriers to U.S. products will remain low, and American
companies will have a means to solve disputes over intellectual
property and other matters.
Taiwan has been negotiating to become a member of the WTO
since 1990 and has met the substantive conditions for
membership. According to the Congressional Research Service, it
has completed agreements with each of the 26 WTO members that
requested bilateral negotiations, and has held 10 meetings with
the WTO working party in Geneva, resolving all substantive
issues surrounding its admission.
China has insisted that Taiwan can get into the WTO only
after it does, and has lobbied other countries to support this
position. In the past, Clinton administration officials have
assured us that Taiwan's accession would closely follow
China's, and Mr. Chairman, at this point let me say that I will
submit my entire statement for the record, if I might. I am
going to skip over certain portions of the testimony that
confirm what I just said and what you already know.
The Chairman. Without objection, the full text will be
included in the record.
Senator Kyl. Thank you. What I would like to do, though, is
to refer to at least a couple of recent press reports that get
to the point that Senator Thomas raised. There have been some
suggestions that China may be planning to block Taiwan's WTO
entry, and that is frankly what I am concerned about.
According to a Wall Street Journal report in July, for
example, and I am quoting now: ``As WTO staff members draw up
the so-called protocol agreements--the reams of paper that
define exactly what concessions China will make in order to
gain entry into the organization--China is insisting that its
claim over Taiwan be recognized in the legal language . . .
chief Chinese negotiator Long Yongtu said . . . such a stand
is, a matter of principle for us.''
That would upset a consensus within the WTO, according to
the Wall Street Journal, ``that Taiwan should be allowed to
enter the club as a separate economic area--that is, not an
independent country, but also not as an explicit part of China.
Some WTO members have argued that Taiwan has long-since
fulfilled its requirements to join the club and its application
has been held up only to satisfy China's demand that Taiwan
shouldn't win entry into the organization first.''
As I mentioned earlier, the United States should support
Taiwan's admission to the WTO not merely for economic reasons,
but also to honor our commitments to a close, long-standing
ally, and to demonstrate our intention to support democracies
that respect the rule of law.
Skipping over some other testimony, Mr. Chairman, let me
get right down to the bottom line and quote some words of Harry
Truman, a President that I know we all respect for his plain
spoken language. Here is what he said in announcing what became
known as the Truman Doctrine.
``At the present moment in world history nearly every
nation must choose between alternative ways of life. The choice
is too often not a free one. One way of life is based upon the
will of the majority, and is distinguished by free
institutions, representative government, free elections,
guarantees of individual liberty, freedom of speech and
religion, and freedom from political oppression. The second way
of life is based upon the will of a minority forcibly imposed
upon the majority. It relies upon terror and oppression, a
controlled press and radio, fixed elections, and the
suppression of personal freedoms. I believe that it must be the
policy of the United States to support free peoples who are
resisting attempted subjugation by armed minorities or outside
pressures. I believe that we must assist free peoples to work
out their own destinies in their own way.'' So said Harry
Truman.
Now, he spoke these words in 1947, at a time when it was
very difficult to stand up to communism on the march from the
Soviet Union. The challenge we face today in dealing with China
and Taiwan should not be as great as the courageous struggle of
the cold war. The administration cannot support China's entry
into the WTO without equally supporting Taiwan's entry into the
WTO. This is but one of many signals we should be sending to
the Communist regime in Beijing, about America's determination
to meet our commitments and our resolve to support Taiwan.
Mr. Chairman, last night, I received a letter from
President Clinton that responded to a letter that I sent him in
July along with 30 other Senators, including yourself, Mr.
Chairman, that sought assurances that his administration
remained committed to Taiwan's entry to the WTO. In the letter,
the President stated, and I am quoting, ``my administration
remains firmly committed to the goal of WTO General Council
approval of the accession packages for China and Taiwan at the
same session.'' The President's letter went on to say that
while, ``China has made clear on many occasions, and at high
levels, that it will not oppose Taiwan's accession to the WTO.
Nevertheless, China did submit proposed language to their
working party stating that Taiwan is a separate customs
territory of China. ``We have advised the Chinese,'' the
President went on to say, ``that such language is inappropriate
and irrelevant to the work of the working party and that we
will not accept it,'' end of quote from his letter.
As the President clearly acknowledged in his letter,
despite previous assurances by China and the administration
that Taiwan will be admitted to the WTO without opposition,
under the surface there is a problem. As it always does, China
is using yet another diplomatic opportunity to assert its view
that Taiwan is nothing more than a province of China.
This is an important issue that the President and his
administration need to resolve. They must make it clear that
there will be consequences should China fail to live up to its
commitments not to block Taiwan's entry to the WTO as a
separate customs territory, Chinese Taipei, not a separate
territory of China. It is my hope the President can give the
Senate such concrete assurances before we begin debate on a
bill extending permanent normal trade status to China, failing
which it may be necessary for Congress to consider a
legislative solution to this problem.
Thank you, Mr. Chairman, for the opportunity to testify.
[The prepared statement of Senator Kyl follows:]
Prepared Statement of Senator Jon Kyl
Mr. Chairman, thank you for the opportunity to testify at today's
hearing.
I believe it is important for the United States to support Taiwan's
entry into the World Trade Organization (WTO). First because of the
economic benefits that its entry would bring. Secondly, because of the
need to meet our commitments to our close and longstanding ally. And
third, due to our desire to defend and promote democratic governments,
with free markets, that respect the rule of law and the human rights of
their people.
Let me first discuss the economic importance of Taiwan's admission
to the WTO. The WTO plays an important role in promoting free and fair
trade. Under the WTO, member countries agree on a set of rules and
principles for trade, which in turn creates a stable and predictable
trade environment. Secondly, the WTO provides a mechanism to enforce
these rules, including a procedure for countries to resolve trade
disputes. And finally, the WTO provides a forum for negotiations to
reduce trade barriers worldwide.
Since the founding of its predecessor GATT in 1948, membership in
the organization has grown from 23 countries to 136 today. The general
view among economists is that a more predictable trade environment, and
a reduction of trade barriers, has contributed to the unprecedented
economic prosperity that most countries currently enjoy. Statistics
support this view: In 1998, world exports were 18 times larger than in
1950, and world GDP was 6 times greater in 1998 than 1950, according to
the Congressional Research Service.
Based on its importance to the world economy, Taiwan should be
admitted to the WTO. It has the 19th largest economy and is the 14th
largest trading nation in the world. Taiwan's economy is also closely
linked to the U.S. It is America's 8th largest trading partner and
purchases more American goods than many of our other major trading
partners, like mainland China, Australia, and Italy. U.S. trade with
Taiwan should continue to grow. Over two years ago, we signed a
bilateral WTO agreement with Taiwan that included significant
reductions in tariffs and other barriers for exports of a variety of
U.S. goods and services, including agricultural goods, automotive
products, and pharmaceuticals. The admission of Taiwan to the WTO
ensures that market barriers to U.S. products will remain low and
American companies will have a means to solve disputes over
intellectual property and other matters.
Taiwan has been negotiating to become a member of the WTO since
1990 and has met the substantive conditions for membership. According
to the Congressional Research Service, it has completed agreements with
each of the 26 WTO members that requested bilateral negotiations, and
has held 10 meetings with the WTO Working Party in Geneva, resolving
all substantive issues surrounding its admission.
China has insisted that Taiwan can get into the WTO only after it
does, and has lobbied other countries to support this position. In the
past, Clinton Administration officials have assured us that Taiwan's
accession would closely follow China's. In February, U.S. Trade
Representative Charlene Barshefsky testified to the House of
Representatives that ``. . . the only issue with respect to Taiwan's
accession . . . pertains to timing . . . there is a tacit understanding
. . . among WTO members in general--but also, frankly, between China
and Taiwan--that China would enter first and China would not block in
any way Taiwan's accession thereafter, and that might be immediately
thereafter or within days or hours or seconds or weeks. . . .'' Later
that same month, in response to a statement by Sen. Roth that ``. . .
there's a great deal of concern that Taiwan might be blocked [from
entering the WTO] once China secures such membership,'' Ambassador
Barshefsky testified that ``. . . the United States would do everything
in our power to ensure that that does not happen in any respect because
Taiwan's entry is also critical.''
Recent press reports have renewed concern that China may be
planning to block Taiwan's WTO entry. As the Wall Street Journal
reported in July,
. . . as WTO staff members draw up the so-called protocol
agreements--the reams of paper that define exactly what
concessions China will make in order to gain entry into the
organization--China is insisting that its claim over Taiwan be
recognized in the legal language . . . chief Chinese negotiator
Long Yongtu said . . . such a stand ``is a matter of principle
for us'' . . . . That would upset a consensus within the WTO
that Taiwan should be allowed to enter the club as a separate
economic area--that is, not an independent country, but also
not as an explicit part of China. Some WTO members have argued
that Taiwan has long since fulfilled its requirements to join
the club and its application has been held up only to satisfy
China's demand that Taiwan shouldn't win entry to the
organization first.
Last night, I received a letter from President Clinton that
responded to a letter I sent him in July along with 30 other Senators,
including Chairman Helms, that sought assurances that his
administration remained committed to Taiwan's entry to the WTO. In the
letter the President stated that, ``My administration remains firmly
committed to the goal of WTO General Council approval of the accession
packages for China and Taiwan at the same session.'' The President's
letter went on to say that while ``China has made clear on many
occasions, and at high levels, that it will not oppose Taiwan's
accession to the WTO. Nevertheless, China did submit proposed language
to their working party stating that Taiwan is a separate customs
territory of China. We have advised the Chinese that such language is
inappropriate and irrelevant to the work of the working party and that
we will not accept it.''
As the President acknowledged in the letter, despite previous
assurances by China and the administration that Taiwan will be admitted
to the WTO without opposition, under the surface there is a problem. As
it always does, China is using yet another diplomatic opportunity to
assert its view that Taiwan is nothing more than a province of China.
This is an important issue that the President and his administration
need to resolve. They must make it clear that there will be
consequences should China fail to live up to its commitments not to
block Taiwan's entry to the WTO as a separate customs territory,
Chinese Taipei, not a customs territory of China. It is my hope the
President can give the Senate such concrete assurances before we begin
debate on a bill extending permanent normal trade status to China,
failing which it may be necessary for Congress to consider a
legislative solution to this problem.
As I mentioned earlier, the United States should support Taiwan's
admission to the WTO, not merely for economic reasons, but also to
honor our commitments to a close, long-standing ally, and to
demonstrate our intention to support democracies that respect the rule
of law.
When our nation switched diplomatic recognition to mainland China,
we also enacted the 1979 Taiwan Relations Act to state our continued
commitment to the security of Taiwan. This law states, ``. . . the
United States decision to establish diplomatic relations with the
People's Republic of China rests upon the expectation that the future
of Taiwan will be determined by peaceful means.'' It goes on to say the
U.S. would ``. . . consider any effort to determine the future of
Taiwan by other than peaceful means, including by boycotts or
embargoes, a threat to the peace and security of the Western Pacific
area and of grave concern to the United States.'' And finally, it says
the U.S. will sell ``. . . defense articles and defense services in
such quantity as may be necessary to enable Taiwan to maintain a
sufficient self-defense capability.''
Unfortunately, the Clinton administration has not lived up to the
spirit of the Taiwan Relations Act. For example, despite the fact that
China enjoys a 65 to 4 advantage in submarines, the administration has
refused to sell submarines or other equipment to Taiwan that would
allow it to fend off an attempt by China to impose a naval blockade on
the island. The administration refuses to offer Taiwan the latest
theater missile defense systems to defend against a buildup of Chinese
ballistic missiles. And, it has reportedly said it will sell AMRAAM
air-to-air missiles to Taiwan, which would help it maintain air-
superiority over its territory, only if the missiles are stored in a
warehouse in the U.S. until China acquires an equally advanced weapon.
The administration has also allowed China to increase Taiwan's
diplomatic isolation. In addition to holding up its admission to the
WTO, the communist regime in Beijing has also blocked its admission to
the World Health Organization. Taiwan has sought membership in this
organization to have access to the latest information on vaccines. An
outbreak of the enterovirus in Taiwan in 1998 killed some 70 children,
yet it received outside assistance only from the U.S.
The administration has taken these steps despite the fact that
China's leaders refuse to renounce the use of force in retaking Taiwan,
and issue thinly veiled threats to use nuclear weapons should the U.S.
intervene. For example, in March, the main newspaper of China's
military said, ``China is neither Iraq nor Yugoslavia, but a very
special country . . . it is a country that has certain abilities of
launching a strategic counterattack and the capacity of launching a
long-distance strike. Probably it is not a wise move to be at war with
a country like China, a point which U.S. policymakers know fairly
well.'' Another article in a Chinese military-owned newspaper went
further, saying, ``The United States will not sacrifice 200 million
Americans for 20 million Taiwanese. They will finally acknowledge the
difficulty and withdraw.''
In outlining what became known as the ``Truman Doctrine,''
President Harry Truman said,
At the present moment in world history nearly every nation must
choose between alternative ways of life. The choice is too
often not a free one. One way of life is based upon the will of
the majority, and is distinguished by free institutions,
representative government, free elections, guarantees of
individual liberty, freedom of speech and religion, and freedom
from political oppression. The second way of life is based upon
the will of a minority forcibly imposed upon the majority. It
relies upon terror and oppression, a controlled press and
radio, fixed elections, and the suppression of personal
freedoms. I believe that it must be the policy of the United
States to support free peoples who are resisting attempted
subjugation by armed minorities or outside pressures. I believe
that we must assist free peoples to work out their own
destinies in their own way.
Harry Truman spoke these words in 1947, at a time when it was very
difficult to stand up to communism on the march from the Soviet Union.
The challenge we face today in dealing with China and Taiwan should not
be as great as the courageous struggle of the Cold War. The
administration cannot support China's entry into the WTO without
equally supporting Taiwan's entry into the WTO. This is but one of many
signals we should be sending to the communist regime in Beijing, about
America's determination to meet our commitments and our resolve to
support Taiwan.
Thank you again Mr. Chairman for the opportunity to testify today.
[The letters to which Senator Kyl referred follow:]
United States Senate,
Washington, DC, July 27, 2000.
President William J. Clinton,
The White House,
Washington, DC.
Dear Mr. President:
As the Senate nears consideration of legislation extending
permanent normal trade relations to the People's Republic of China
(PRC), we are writing to express concern that Beijing may be planning
to take actions that would have the effect of blocking Taiwan's
accession to the World Trade Organization (WTO). According to press
reports, the PRC recently offered a proposal at the WTO calling for
that organization to recognize the PRC's position that Taiwan is part
of the mainland. Taiwan is the United States' eighth largest trading
partner, and we support its admission to the WTO as soon as it meets
the criteria for membership.
On several occasions, Administration officials have indicated that
Taiwan's accession to the WTO would closely follow the PRC's. For
example, in February, U.S. Trade Representative Charlene Barshefsky
testified to the House of Representatives that ``. . . the only issue
with respect to Taiwan's [WTO] accession . . . pertains to timing . . .
there is a tacit understanding . . . among WTO members in general--but
also, frankly, between China and Taiwan--that China would enter first
and China would not block in any way Taiwan's accession thereafter, and
that might be immediately thereafter or within days or hours or seconds
or weeks, . . .'' Later that same month, in response to a statement by
Senator Roth that ``there's a great deal of concern that Taiwan might
be blocked (from entering the WTO) once China secures such
membership,'' Ambassador Barshefsky testified that `` . . . the United
States would do everything in our power to ensure that that does not
happen in any respect because Taiwan's entry is also critical.''
We respectfully request that you clarify whether your
Administration continues to believe that Taiwan's entry to the WTO is
critical, whether you remain committed to that goal, and whether you
remain convinced that Taiwan will enter the WTO within days after the
PRC's accession. Furthermore, is the Administration aware of any
efforts by the PRC to impose extraordinary terms and conditions on
Taiwan's accession to the WTO? What specific assurances has Beijing
provided regarding the timing and substance of Taiwan's accession to
the WTO? And what steps has your Administration taken to ensure that
Taiwan will in fact join the WTO immediately following the PRC's
accession?
We would appreciate a response to this inquiry by August 18, in
order to consider its contents prior to Senate debate on extending
permanent normal trade relations to the PRC.
Sincerely,
Jon Kyl Orrin Hatch
Larry Craig Mike Enzi
Don Nickles Trent Lott
Bob Smith Frank Murkowski
Conrad Burns Gordon Smith
Wayne Allard James Inhofe
Mike DeWine Fred Thompson
Mitch McConnell Slade Gorton
Pete Domenici Jesse Helms
Connie Mack Tim Hutchinson
Mike Crapo Arlen Specter
Strom Thurmond Jeff Sessions
Jim Bunning Spencer Abraham
Craig Thomas Robert Bennett
Phil Gramm Susan Collins
Dick Lugar
THE WHITE HOUSE
WASHINGTON
August 31, 2000
The Honorable Jon Kyl
United States Senate,
Washington, DC.
Dear Senator Kyl:
Thank you for your letter regarding Taiwan's accession to the World
Trade Organization (WTO). My administration remains firmly committed to
the goal of WTO General Council approval of the accession packages for
China and Taiwan at the same Session. This goal is widely shared by
other key WTO members.
China has made clear on many occasions, and at high levels, that it
will not oppose Taiwan's accession to the WTO. Nevertheless, China did
submit proposed language to their working party stating that Taiwan is
a separate customs territory of China. We have advised the Chinese that
such language is inappropriate and irrelevant to the work of the
working party and that we will not accept it. We believe that this
position is widely shared by other WTO members.
Again, thank you for writing concerning this important matter.
Sincerely,
Bill Clinton.
The Chairman. Senator, I thank you very much, and may I
inquire, will your schedule permit you to stick around so that
we can sort of have a dialog between you and the next witness?
Senator Kyl. I would be pleased, if the chairman thinks
that would be helpful.
The Chairman. Well, if you would do that, if you want to
come up and sit here, that would be good, whatever you like.
Senator Kyl. Thank you, Mr. Chairman. Perhaps I can just
stay at the table with the next witness, and we can have a
dialog if you like.
The Chairman. Yes, sir, and that next witness is a long-
time friend of many of us on this committee, a distinguished
American. He is the former Assistant Secretary of State for
International Organization Affairs, and today he is widely
recognized as an expert on so many aspects of foreign policy. I
myself call on him for his ideas about something that I am
contemplating, and many of the major daily newspapers of this
country solicit from him his thoughts in the form of op ed
pieces.
John, we welcome you here this morning. We are now
delighted to hear from you.
STATEMENT OF HON. JOHN R. BOLTON, FORMER ASSISTANT SECRETARY OF
STATE FOR INTERNATIONAL ORGANIZATION AFFAIRS
Mr. Bolton. Thank you very much, Mr. Chairman. It is a
pleasure to be here today. I, too, have a prepared statement I
will ask be submitted for the record and try and summarize it.
The Chairman. And it will, without objection.
Mr. Bolton. As Senator Kyl has pointed out, this question
of the accession of Taiwan to the WTO has been with us for
quite some time.
The Chairman. John, let me inquire, can the young folks in
the back hear? You are able to hear. All right, good.
Mr. Bolton. Indeed, earlier this year, when the PRC issued
a white paper about a month before the Taiwanese election, it
became clear that the issue of Taiwan's status vis-a-vis the
PRC was going to be something that could impinge even on the
question of WTO accession for both of those entities, and I
think it is important to repeat just briefly what the PRC said
back in February of this year.
They said, and I am quoting now from their Foreign Ministry
spokesman, ``Taiwan is purely an internal matter of China.
Taiwan is an indivisible part of Chinese territory.'' This was
their document. We view the white paper and the issue of normal
trade relations as two entirely separate issues.
What has happened in the WTO context is that Beijing has
signaled, as Senator Kyl pointed out, that they want a
political statement, in effect, made in the Protocol of
accession that would apply to Taiwan. They want just a few
words, but they want to try and show politically that Taiwan is
and has essentially the same status internationally as Hong
Kong does.
Hong Kong is a member of the WTO, it is a separate customs
territory, but it is also indisputably a part of China under
the one-country-two-systems formula, and in fact the one-
country-two-systems formula was devised by Beijing not for Hong
Kong originally but for Taiwan, which has repeatedly rejected
it.
In 1992, when these accession negotiations began, Taiwan,
recognizing that it did not exactly hold the whip hand here,
agreed to the accession package we have been talking about
whereby the PRC would be admitted first and then essentially
Taiwan would come in almost instantaneously behind it. That has
been the understanding under which all of the complex bilateral
negotiations between Taiwan on the one hand, the PRC on the
other, and their trading partners have been carried out, as
well as the work of the working parties in Geneva devising the
protocols of accession.
So when just a short time ago the PRC interjected this
question of Taiwan's political status, it was not simply
overturning the fundamental understanding that we had been
working on for 8 years, it was also, in my view, taking direct
aim at the World Trade Organization. I speak here today both as
a free trader and as a supporter of expanding the role of free
trade and as a believer, in fact, that if free trade and free
markets ever did occur in mainland China it would have
measurably important effects for the freedom of the Chinese
people.
But the WTO's basic theory is that it is a limited
organization. It has an important role, but limited to economic
trade issues. By trying to superimpose the political issue--the
question of Taiwan's status--in these negotiations the PRC is
taking direct aim at the independence and integrity of the WTO
itself. We have seen with the recent demonstrations in Seattle,
the pressures even within the United States to move the WTO
agenda into extraneous issues like environmental questions and
labor standards. The WTO is vulnerable to these kind of outside
pressures, and those of us who favor free trade should be the
strongest defenders of keeping the WTO free from these
pressures.
Nor is the approach that China has taken here unprecedented
in international organizations, sad to say, and I lay out in my
testimony--I will not repeat here--a summary of the extensive
experience that we faced with the Palestine Liberation
Organization in the late 1980's, when it was attempting to
enhance its international status and in effect establish facts
on the ground vis-a-vis Israel through its work in
international organizations.
It was only the strong leadership and opposition of the
United States that prevented the PLO back in those days from
achieving its objective, but this is a battle that is fought in
many arcane and seemingly trivial fashions. The PLO's struggle
was really the reverse of what China is trying to do--the PLO
was trying to enhance its status. The PRC is trying to reduce
Taiwan's status.
But the PLO in 1988 declared itself a State. We have been
through this struggle with them before. They already declared
themselves a State, and in the United Nations, where they were
an observer organization, they said, we want to take our name
card, which at that time read ``Palestine Liberation
Organization,'' and change it to the word, ``Palestine,'' and
since it was their name card they were allowed to change it.
That is the way it works at the U.N.
Now, you say surely this cannot be something that takes up
the attention of serious diplomats, but it took up a lot of
attention. They were able to change from being an organization
on their name card to being ``Palestine,'' which sounds like it
is a real place, in fact it is a real place, and that was
exactly their objective.
They tried to do a number of other things to gain
membership in the specialized agencies of the United Nations,
which generally speaking require State status under customary
international law, all of which were designed to change their
position vis-a-vis Israel. As I say, they were defeated in
those efforts.
Mr. Chairman, the lesson of the PLO experience for the
United States is that maintaining the nonpolitical nature of
specialized and technical international agencies is entirely
worthwhile, but it is even more beneficial to strive to prevent
them from becoming venues of political conflict in the first
place.
Even successfully opposing efforts to use such agencies for
political purposes, such as in the PLO example, can impose
significant costs on the organizations by diverting them from
their underlying missions and by setting adverse precedents not
easily overcome later. The fact is, that without concerted
American leadership, what the PRC is up to here has a very
substantial chance of success. Let us be clear, I do not think
even they believe their ultimate objective is to stop Taiwan
from entering the WTO. I think their objective is much more
subtle, and that is to say, ``well, it is just language in the
protocol of accession. Certainly we can find language that
would be acceptable, to both sides,'' but which nonetheless
makes their political point. As I said in the prepared
testimony, Mr. Chairman, you know, when health ministers deal
with political questions sometimes your knees get a little bit
shaky. I would just say with all due respect to my colleagues
in the trade area, their dealing with political questions as
sensitive as the status of Taiwan makes me a little bit nervous
as well.
The fundamental point here is that, as with the PLO, it is
the PRC's approach that is illegitimate, not Taiwan's. It is
China that is breaching the nonpolitical nature of the WTO by
inserting this entirely political question, and Taiwan that is
in effect defending the WTO's integrity by resisting.
The people being intransigent and uncooperative here are
from Beijing, not from Taipei. If the United States and others
succumb to the PRC's ploy, not only will Beijing likely succeed
against Taipei, but it will also have severely damaged the
WTO's ability to withstand pressures to consider other
extraneous, nontrade issues.
This, Mr. Chairman, to sum up, is where I think Congress
could well play a very important role. This is a real trade
issue. This is not a human rights issue. This is not a question
of Chinese proliferation of weapons of mass destruction. This
is an issue that is directly related to PNTR status, and I
would hope that Congress in one fashion or another could come
up with a way to make it clear both to Beijing and to the
administration that not only do a vast bipartisan majority
object to any effort to stop Taiwan from coming into the WTO,
but you also object to any effort by China or any concession by
this administration in the negotiations that would attempt to
change or alter or redefine Taiwan's political status.
Thank you very much, Mr. Chairman. I would be pleased to
answer any questions you may have.
[The prepared statement of Mr. Bolton follows:]
Prepared Statement of Hon. John R. Bolton
Mr. Chairman and Members of the Committee, it is a pleasure to
appear before you this morning to discuss issues relating to the
proposed accession of the People's Republic of China (``PRC'') and the
Republic of China on Taiwan (``ROC'' or ``Taiwan'') to the World Trade
Organization (``WTO''). I have a prepared statement that I will
summarize, and submit for the record, and I would be happy to answer
any questions that Members of the Committee might have.
On February 21 of this year, just a month before Taiwan's
presidential election the PRC released an 11,000 word white paper
reiterating Beijing's position that it reserved the right to use
military force in order to reunify Taiwan with the Mainland. Indeed,
the white paper announced that Beijing would consider military force
permissible merely if Taiwan, in the PRC's view, unjustifiably delayed
talks on reunification, a major escalation of the threat level against
the ROC. (Previously, Beijing had said that invasion would be justified
if Taiwan explicitly declared independence from the PRC, or if Taiwan
was occupied by a foreign power.) Although the United States rejected
this PRC assertion, and although many believed that it backfired on
Beijing in the ROC election, the white paper unquestionable represented
a major escalation of international pressure by the PRC against Taiwan.
Accordingly, since at least early this year, many have worried that
the PRC would not adhere to the terms of the initial agreement under
which both PRC and ROC applications to the General Agreement on Trade
and Tariffs (``GATT'') (and now in GATT's successor organization, the
WTO) would be treated effectively in tandem. When criticisms of the
white paper were raised in the United States, just a few days after its
release, the PRC reacted angrily to any suggestion that its military
threats against Taiwan should be considered in connection with
Congressional deliberations over Permanent Normal Trade Relations
(``PNTR'') status for China. PRC Foreign Ministry Spokesman Zhu Bangzao
said: ``Taiwan is purely an internal matter of China. Taiwan is an
indivisible part of Chinese territory . . ..'' Zhu said: ``we view the
white paper and the issue of normal trade relations as two entirely
separate issues,'' and that China ``firmly opposes any attempt to link
these issues.'' The March 18, 2000, election of Chen Shuibian as
Taiwan's President, and the effective demise of the ``one China''
policy reflected in the broad popular consensus on the island, have
only exacerbated those fears.
Until the successful conclusion of the requisite bilateral
negotiations between the PRC and the United States, the European Union,
and other major trading partners, the issue of Taiwan's accession
pursuant to the original ``understanding'' had not received prominent
attention in Washington. Just recently, however, Beijing has explicitly
introduced the explosive political issue of Taiwan's political status
into the WTO's consideration of the pending membership applications for
China and Taiwan. Although apparently not directly challenging Taiwan's
application, the PRC is attempting to condition Taiwan's WTO entry on
accepting the long-standing PRC position that Taiwan is part of
``China.'' If the PRC's insistence on this seemingly innocuous bit of
nomenclature were to prevail, it would mark a significant victory in
its campaign to assert sovereignty over Taiwan. Moreover, such a
politicization of the WTO could gravely damage this already-shaky new
organization, both in the United States and in the world as a whole.
The WTO is intended to be purely a trade organization, divorced
from political questions that should be handled bilaterally or in other
international organizations. Trade issues themselves are often
intractable, and introducing political or other non-trade issues might
bring the entire WTO process to a halt. Thus, neither the WTO nor its
predecessor, the GATT, requires members to be ``states'' in
international terms, but only ``customs territories'' that have
effective control over customs policies within their geographical
territories. Under this approach, Hong Kong, for example, is a WTO
member, even though it is indisputably part of the PRC. This is an
entirely salutary approach (and was long followed in the GATT context),
one that it is in the long-term interests of the United States, and one
that we should work hard to preserve. It clearly differentiates
questions of WTO membership from membership in the United Nations, or
the UN's specialized and technical agencies, which almost invariably
limit membership to ``states'' as understood under ``customary
international law.''
Taiwan is also currently on track for WTO admission as a ``customs
territory,'' thus avoiding, for WTO purposes, the flammable issue of
Taiwan's international political status. When the accession process for
Taiwan and the PRC was launched in late 1992, all agreed that the
underlying political disputes would be put aside, consistent with
GATT's limited focus on trade. Under that arrangement, once all of the
requisite bilateral and multilateral negotiations were successfully
completed, the PRC was to enter GATT (and, subsequently, the WTO)
slightly ahead of Taiwan, which would in turn become a member under the
name ``Chinese Taipei.'' At that point, the PRC, Hong Kong and Taiwan
would all be full WTO members as ``customs territories,'' with the
still-unresolved political issues to be fought out elsewhere.
The PRC's interjection of the disruptive political status issue
into the WTO admissions process now was obviously carefully calculated
in Beijing. Washington's first reaction was that the PRC might have
endangered the PRC's quest for PNTR with the United States, which the
Senate is still considering. To avoid unrest in Congress, the Clinton
Administration correctly stated that it opposed the PRC effort.
Significantly, however, Deputy U.S. Trade Representative Rita Hayes
also said publicly that the 1992 arrangement was still in place, and
that ``China is going to live up to its commitments,'' something that
the PRC itself has not yet acknowledged. To the contrary, China's
Deputy Trade Minister, Long Yongtu, responded ominously: ``the one
China policy is a matter of principle for us.''
In fact, the PRC is trying to advance its political agenda in a
non-political forum, rather than directly trying to keep Taiwan out of
the WTO (although that might well be the practical consequence).
Because the trade negotiators, business interests and lawyers who
inhabit the WTO world are relatively isolated from larger international
political issues, the stakes will not appear to them as high as they
really are. Mere questions of ``name cards'' seem insignificant
compared to ``important'' questions like PRC agricultural export
subsidies (on which, not coincidentally, the PRC is also now
backtracking).
This is a familiar tactic in international organizations. The
undisputed master is the Palestine Liberation Organization (``PLO''),
which for years attempted to enhance its international status by
campaigning for membership in such bodies as the World Health
Organization (``WHO''), which requires that members must be ``states''
in international parlance. By so doing, the PLO hoped to enhance its
international status (or at least the perception of that status, which
may be nearly the same thing), and thereby create ``facts on the
ground'' in its negotiations with Israel, thus bolstering its
bargaining position.
The PLO began this effort in 1988, by declaring its ``statehood,''
and changing the name card in front of its desk at the U.N. from
``Palestine Liberation Organization'' to ``Palestine.'' ``Palestine,''
of course, sounds much more like a ``state'' or at least a geographical
entity than something with the word ``organization'' in its name. This
name change the PLO could accomplish unilaterally, but membership in
U.N. specialized agencies required affirmative votes of the existing
memberships. Accordingly, in late 1988 and early 1989, the PLO began a
massive diplomatic campaign to secure both diplomatic recognition, as
well as the necessary majorities in international organizations.
Although the PLO was blocked in its campaign to join the WHO in 1989,
for example, its efforts at least briefly created chaos within the U.N.
system, from whose members the PLO hoped to extract political or other
concessions, even if it did not achieve the ultimate objective of full
membership. (I have attached a brief description of the WHO controversy
as an Appendix to this testimony.)
Even after its unsuccessful efforts in the WHO, the PLO tried
similar, and ultimately unsuccessful approaches in a number of other
international organizations. One of its last efforts to enhance its
status was in the U.N. General Assembly. There, the PLO proposed that
its desk on the floor of the U.N. General Assembly be physically moved
closer to the location of the desks of the observer states (Switzerland
and the Holy See), hoping thereby to pretend that it too was an
observer state rather than an observer national liberation movement.
One might say, correctly, that such apparent trivialities should not
impinge on truly important policy issues, but, sadly, in international
diplomacy almost nothing is too trivial.
The lesson of the PLO experience for the United States is that
maintaining the non-political nature of specialized and technical
international agencies is highly worthwhile, but that it is even more
beneficial to strive to prevent them from becoming venues of political
conflict in the first place. Even successfully opposing efforts to use
such agencies for political purposes, such as in the PLO case, can
impose significant costs on the organizations by diverting them from
their underlying missions, and by setting adverse precedents that are
often not easily overcome later. Moreover, the PLO example also
demonstrates how seemingly arcane points of argument can assume
enormous significance if not handled properly when they arise. Finally,
had it not been for the leading role played by the United States in
opposing the PLO, it almost surely would have succeeded in its quest
for U.N. membership, with untold adverse consequences for the Middle
East peace process and the U.N. system itself. The fact remains that,
absent concerted American leadership and diplomacy, disruptive
political agendas have a far higher chance of success in technical
organizations, a point we cannot ignore in the present discussion.
Just as there is nothing so unedifying as the sight of Health
Ministers attempting to resolve international political questions, also
unappetizing is the notion of trade officials negotiating the political
status of Taiwan. The PRC will doubtless offer ``compromises'' on its
initial demand, and insist that Taiwan's subsequent unwillingness to
give way is the real source of the ``problem.'' Trade officials, like
their health ministry counterparts faced with PLO intransigence, will
predictably hail the PRC ``concessions,'' and pressure Taiwan to accept
what would otherwise be flatly unacceptable. This is the PRC's real
strategy, and Deputy USTR Hayes' enthusiastic embrace of the Chinese
view shows that Beijing has carefully measured its marks in the Clinton
Administration.
But the fundamental point is that, as with the PLO, it is the PRC's
approach that is illegitimate, not Taiwan's. It is China that is
breaching the non-political nature of the WTO by inserting this
entirely political question, and Taiwan that is, in effect, defending
the WTO's integrity by resisting. The people being intransigent and
uncooperative here are from Beijing, not Taipei. If the United States
and others succumb to the PRC's ploy, not only will Beijing likely
succeed against Taipei, but it will also have severely damaged the
WTO's ability to withstand pressures to consider other extraneous, non-
trade issues, such as labor standards and the environment, to name just
two. Certainly the past few years have shown us just how vulnerable the
WTO is to such pressures, and it would be irresponsible not to take the
implications of Beijing's ploy seriously.
Here is where Congress must declare unequivocally that the PRC's
maneuver is unacceptable, and that there is no possible compromise on
this point. This is a real trade issue, not one of human rights or
weapons proliferation, and one that therefore is directly related to
PNTR status. Congress should insist, before granting PNTR, that the PRC
drop all political objectives in the WTO, and specifically that is
should not attempt to derail Taiwan's accession, or attempt to extract
political leverage from the process. It should also insist, in the
Clinton Administration's waning days, that the President himself ensure
that U.S. diplomats are not seduced by Chinese ``reasonableness,'' and
not allow the 1992 accession agreement to be subverted.
Senator Kyl's proposed amendment would go a long way toward
achieving this objective. Because of the Administration's weak defense
of the original WTO ``understanding'' on PRC and ROC accession,
Congress has little maneuvering room if it wishes to take up the slack.
The Kyl amendment attempts to overcome that problem, not by
undercutting the granting of PNTR status to China, or by introducing
extraneous non-trade issues, but simply by calling on China to adhere
to its original agreement on the sequence of accession to the WTO for
both the PRC and ``Chinese Taipei.''
The amendment is a limited and prudent step, and one that should
not derail or unduly delay the PNTR process. There is no inconsistency
between the Kyl amendment and a position fully supportive of free trade
and the WTO. To the contrary, in order to preserve the WTO as a non-
political body, Congress would do well to consider the long-term
benefits for the WTO that would accrue by supporting what could be an
important and precedent-setting declaration of Congressional intention
to insulate the WTO from extraneous political debates. Whatever one's
position on PNTR, or on other amendments concerning PNTR that have been
proposed, the Kyl amendment should be considered on its own merits as a
genuine effort to expand the legitimate membership of the WTO, enhance
trade opportunities for Americans, Chinese and Taiwanese alike.
Mr. Chairman, thank you again for the opportunity to testify today,
and I would be pleased to answer any questions the Committee may have.
Appendix: The Status of the Palestine Liberation Organization
In 1988, after the Palestine Liberation Organization (``PLO'')
officially renounced the use of terrorism, some ninety nations
acknowledged the PLO as a ``state'' for Palestinians in the West Bank
and the Gaza Strip. Shortly thereafter, the PLO mounted a wide-ranging
effort to join various agencies in the U.N. system to further
``confirm'' its international law status as a ``state.'' Since almost
all U.N. bodies provide full membership only to ``states,'' the PLO saw
membership as a validation of international legitimacy, and an
important source of political assistance in the Arab-Israeli peace
process.
In early 1989, Israeli officials signaled to the United States that
they were quite concerned about PLO initiatives to join bodies as
diverse as the World Health Organization (``WHO''), the International
Telecommunications Union (``ITU''), UNESCO and others. The United
States accepted Israel's analysis that the PLO was not a ``state''
within the meaning of customary international law, and had no rightful
claim to join any U.N. organization as a ``member state.'' Moreover,
the United States was particularly insistent that the legal and
diplomatic issues surrounding the PLO's status not be contested in the
U.N.'s specialized agencies, whose politicization we had long resisted.
By early April, 1989, however, it seemed quite likely that the PLO
might succeed in obtaining WHO membership, if for no other reason than
that a majority of WHO members had already recognized the PLO's
``statehood.'' Indeed, the U.S. Mission in Geneva believed that the
PLO's membership in the WHO was virtually ``inevitable.'' Other Western
nations had essentially the same assessment, in part because of the
PLO's efforts, and in part because of professed outrage at Israeli
treatment of Palestinians in the occupied territories. The PLO itself
was confident of its prospects, rejecting the U.S. request that it back
away from its U.N. membership campaign.
Given these circumstances, only a vigorous American effort could
derail the PLO. Secretary of State James A. Baker, III personally
emphasized the strength of American opposition in a variety of ways.
One of the first of these was a world-wide cable to all American
embassies, instructing them to approach foreign ministries at the
highest possible level to explain the American position, and to stress
the importance we attached to the issue. Similarly, the Department
called in Ambassadors in Washington to make the same points. By then,
PLO rhetoric had risen to the point that PLO leader Yassir Arafat told
U.N. Secretary General Perez de Cuellar that he would seek to have
Israel expelled from the U.N. General Assembly if the PLO were not
admitted to the specialized agencies. Arafat was also engaging in an
extensive disinformation campaign, telling Ambassadors in Geneva that
the United States was actually ``indifferent'' to whether or not the
PLO succeeded, and that U.S. ``opposition'' to the PLO's efforts was
purely for domestic American political consumption.
By late April, 1989, word of the PLO's efforts reached Capitol
Hill, where opposition to the PLO was quite strong. Some Senators spoke
openly about not paying the U.S. assessment (typically twenty-five
percent of the budget) to any U.N. agency that admitted the PLO.
Secretary Baker accepted this approach at the end of April, and stated
it publicly on May 1, 1989: ``I will recommend to the President that
the United States make no further contributions, voluntary or assessed,
to any international organization which makes any change in the PLO's
present status as an observer organization.'' Obviously, Baker had
already spoken to President Bush, and was completely confident that his
recommendation would be immediately accepted, if necessary.
Baker's public statement, coming just a few days before the opening
of the World Health Assembly in Geneva, had a dramatic effect. First,
it proved conclusively just how strongly the United States cared about
the possibility of the PLO joining the WHO. Second, it demonstrated in
American domestic political circles the importance the issue had for
the President and Secretary of State. Third, it got the attention of
U.N. officials around the world, who finally began to realize the
potentially enormous impact of an international decision to admit the
PLO to any U.N. body or agency.
When the World Health Assembly formally opened on May 7, 1989, the
issue of the PLO's status was still unresolved. Health Ministers, who
typically head delegations to the Assembly, had no real sense of the
political meaning of the PLO's efforts, and they were largely
uninstructed from their foreign ministries. Moreover, ``compromise''
Assembly resolutions being floated by several Western governments in
Geneva seemed to imply that the PLO's membership in the WHO (and then
other components of the U.N. system) was only a question of timing
rather than substance.
Accordingly, despite Secretary Baker's unequivocal public
statement, the United States remained very concerned about what would
actually happen in Geneva. The Western Group was divided and uncertain,
and other regional groupings seemed perfectly inclined to allow the
PLO's application to succeed. Procedural complexities consumed enormous
amounts of time, particularly on the possibility of secret votes in
committees and in the World Health Assembly itself on the key issues.
Draft resolutions multiplied, but the American delegation was
unequivocal that it would not accept any compromise on the basic point
that the PLO was simply not qualified to be a WHO member because it was
not a ``state.'' The firmness of the United States position surprised
many delegations, especially among the European health officials. There
was considerable resentment about the financial ``threat'' that the
United States had made, but there was no question that the message had
gotten across.
When the floor debate in the World Health Assembly finally began,
confusion was rampant. Efforts at close coordination among Western
countries frequently broke down, requiring numerous recesses and
further consultations (all complicated by internal EU consultations).
Fortunately, several African and Pacific island countries were strong
supporters of the U.S. position. One critical vote was to cut off
further debate on the PLO's application, which carried by a substantial
majority of those voting (although there were many abstentions). The
final vote rejecting the PLO application, as the New York Times
reported, ``came after six hours of tumultuous and confused
parliamentary maneuvering.'' Congressional reaction to the World Health
Assembly's vote rejecting the PLO was uniformly positive. Subsequent
PLO efforts in 1989-90 to enhance its status were similarly
unsuccessful.
The Chairman. I am going to comment to both of you your
testimony is just right on target.
A question prepared for me, and I just asked the young man
if he can give me the direct figures and he said, of course,
which I expected him to do, and he said, Taiwan imports from
the United States almost $20 billion a year. Mainland China
imports only about $14 billion.
Now, the interesting thing about that is that China has 50
times the population of Taiwan, and all sorts of things like
that. Now, I want to ask you, both of you, and particularly you
on the first one, John, you were Assistant Secretary of State
for International Organization Affairs. I believe that was your
specific title at the time. Now, tell me how China could work
to block Taiwan's entry into the WTO in the months before China
itself enters the WTO. Either one of you, or both of you.
Mr. Bolton. Well, I think they have already started to do
it.
The Chairman. I know that.
Mr. Bolton. I think your question is right on target. The
path they have chosen is language that to the nonexpert on
cross-Strait issues would seem like something that is pretty
innocuous, frankly. What they are trying to do is to put the
political question of Taiwan's accession into their protocol
document in a way that would make it impossible for Taiwan to
accept.
In other words, they are trying to, in effect, condition
Taiwan's membership on accepting political subordination to
Beijing, and their argument is going to be: ``we are not
blocking Taiwan. We are just proposing something that we
think,'' as their Foreign Ministry spokesman said, ``is a
matter of deep principle. We are happy to have Taiwan in, just
as we are Hong Kong.'' That is why this is such a pernicious,
such an adept diplomatic effort by them and why it is so
dangerous, because it appears to float below the radar screen
when in fact it has enormous implications.
The Chairman. Now, Hong Kong is on the Rules Committee of
the WTO, is that not correct?
Mr. Bolton. I believe that is right, yes, sir.
The Chairman. Jon, I believe that is correct.
Now, Jon, I believe you mentioned President Clinton's
response to the letter that I joined you in sending. I think
there were 30 of us who joined you, as a matter of fact----
Senator Kyl. Yes.
The Chairman [continuing]. Asking what assurances China
gave the United States regarding Taiwan's accession to the WTO,
and I do not believe the President answered the question, and
we were sincerely seeking a response.
It reminds me of an old gentleman back home, Mr. Nee
English, N-e-e English. Now, I was working in a drug store at
the time. I was in high school. I looked out the front window
and there was a lady just pointing her finger at Mr. English,
and he came in shaking his head, and I said, Mr. English, what
did she say to you? He said, ``I don't know. She didn't say.''
And so Mr. Clinton, whoever wrote the letter for him, did
not say how he would respond to that letter. Now, it appears to
me that from the letter all of China's assurances to the
administration seemed, before China started the shenanigans
going to Taiwan's status--and I believe that was back in July.
It does not state in the President's letter that Clinton-Gore
received pledges in writing from Beijing about permitting
Taiwan's accession to the WTO. Am I incorrect about that?
Senator Kyl. Mr. Chairman, you are correct, there is no
reference to any written assurance, and the implication from
the President's letter is that the assurances were prior to
China's most recent statements. I think in some respects the
President has answered. He did it very carefully and
diplomatically, but I might actually quote the paragraph.
The answer is one which is not satisfactory, but I do think
he has answered, and I would stress to my colleague, Senator
Thomas, I think this is the point made. The President himself
is signaling that we have got a problem here, and I think the
question is, how can we in Congress help him, in what I believe
is a very sincere effort on the part of the President to ensure
that Taiwan enters into WTO accession under the right terms,
exactly as Mr. Bolton has said.
The President first said ``China has made clear on many
occasions, and at high levels, that it will not oppose Taiwan's
accession to the WTO,'' but now comes the other shoe.
``Nevertheless, China did submit proposed language to its
working party stating that Taiwan is a separate customs
territory of China.''
Here is where the President put forth his position. ``We
have advised the Chinese that such language is inappropriate
and irrelevant to the work of the working party,'' precisely
Mr. Bolton's point, ``and that we will not accept it,'' the
President said. ``We believe that this position is widely
shared by other WTO members.''
Words matter. I am a lawyer, and I cannot tell you how many
times I have argued with other lawyers about one or two words,
and nonlawyers might say, what difference does it matter, but
it can be the difference between lightning and lightning bug.
There is a big difference sometimes.
And what Mr. Bolton said is exactly correct. What the PRC
is attempting to do here is to use this nonpolitical entity to
help create the legal basis for its claim that Taiwan is
nothing but a province of China, whereas most of the world
community treats Taiwan as something different from that. It is
a subtle distinction, but an important one, and that is why the
difference between the words, ``separate customs entity,
Chinese Taipei,'' which is the Taiwnese description, and that
which the United States has heretofore supported, I believe.
It is so much different than ``separate customs entity of
China,'' which is the PRC language that has been submitted. It
may seem unimportant today to a lot of people, but for the
reasons that Mr. Bolton pointed out and, frankly, confirmed by
President Clinton in his letter, it is very important.
It is unacceptable to the United States, and I believe that
the Congress should do whatever we can to support the
President's position so that the PRC understands very clearly
that this is a unified position of the American Government. We
are all for China's accession, but we are also all for Taiwan's
accession under the right terminology.
The Chairman. I am going to turn it over to my friend to
the right in just a minute, but the United Nations is beginning
its sessions this week. That is correct, is it not?
Senator Kyl. Today.
The Chairman. And Taiwan I am confident is going to make a
bid for membership in the United Nations. Now, last year the
Clinton-Gore administration in fact spoke against Taiwan's
membership. Is my memory correct on that? Whereas previously
the administration has simply stayed silent.
Now, I will stop there and put a pause, and I yield to you,
sir.
Senator Thomas. Thank you, Mr. Chairman. A couple of
questions, I guess. It is kind of unusual in a hearing not to
have a witness who represents a different point of view. You
apparently do not. The two of you represent the same point of
view, so that is fine. Do you favor WTO for China, the PRC?
Mr. Bolton. I favor it ultimately, yes, I do. I should not
step on my lines. Tomorrow I am going to appear as a member of
the United States Commission on International Religious
Freedom, where we have taken--which is a bipartisan
Commission--certain views on when it would be appropriate for
China to enter, given its repression of religious freedom, but
I do favor China's admission, and I do support it at an
appropriate time.
Senator Thomas. You are not particularly interested in
whether it happens during this session of Congress or not?
Mr. Bolton. I think the timing of the grant of PNTR status
and, indeed, China's accession sends an important signal and
given, for example, just in the area of religious freedom, that
the Clinton administration's own report, issued yesterday, says
that conditions of religious freedom in China have deteriorated
markedly in the past year, not our report but the
administration's report, I do worry about the timing, and I
think getting----
Senator Thomas. I do not understand. What do you mean, you
worry about the timing?
Mr. Bolton. I think it sends a bad signal to Beijing that
they can increase repression of religious freedom and still get
PNTR status.
Senator Thomas. So you are talking about religious freedom
here and not trade, is that right?
Mr. Bolton. Well, you were asking the question and I wanted
to give you a full answer. I believe that the question of
Taiwan's political status is highly important to American
foreign policy, and I do not think--what the thrust of my
testimony is, it should not be swept aside, as I believe the
PRC would like to have it done, simply to grant them PNTR
status.
Senator Thomas. You think the House swept it aside when
they passed----
Mr. Bolton. I do not think they considered it, because I
think the most recent PRC effort, this language in the
accession document, occurred after House action. What the House
would have done had they done it before----
Senator Thomas. I do not understand that. We have been
dealing with them for a very long time. To be surprised in the
last couple of months, I do not understand that. If you have
been involved with China--I assume you have--they have changed
substantially over the last number of years, and to suggest
that we did not know what is happening over there seems to be a
little naive.
Mr. Bolton. I can only speak for myself on that point,
Senator. I have worried about this point with respect to Taiwan
from the get-go.
Senator Thomas. OK. Well, that is fine.
Jon, or Senator Kyl, I agree entirely with your view, and I
think we ought to help the President and support what he
indicated in the letter. Do you think not having WTO, or normal
trade relations, passed in this session would be helpful?
Senator Kyl. Well, Mr. Chairman, Senator Thomas, I agree
with you that we should grant WTO status to the PRC, and I have
no objection, notwithstanding the same concerns that Mr. Bolton
has, to that occurring in this session. But, I do think some
other things need to accompany it. It needs to be based upon
certain fundamentals, one of which is that the Chinese, the
PRC, should not be able to dictate the exact terminology with
respect to which Taiwan also comes in, and I have no objection
to Taiwan coming in immediately after the PRC as well. My point
is that they should not use their entry into the WTO to score a
different political point.
It is the same thing you were talking about with respect to
human rights. While it is related, it is not the trade issue
per se, and I would say the same thing here. While the Chinese
fixation on identifying the political status of Taiwan is a
related issue, it should not be a factor in the granting of
either WTO status for the PRC or Taiwan.
Senator Thomas. And I agree with you. I agree with you
entirely.
Mr. Bolton, is it not true that PRC probably will be in WTO
whether we pass this or not?
Mr. Bolton. I think that is correct, but I think--and I do
not object to that, as I have said, but what I do think is
important is that we not set a precedent that will damage the
WTO in years down--in years to follow, where political
questions like this can be interjected and where, if other
countries see the opportunity for political gain, they will use
the WTO and corrupt it.
Senator Thomas. I agree with you entirely, but there is no
assurance that that is going to happen. We can oppose that, and
we can do it in the working group.
Mr. Bolton. The most important thing, Mr. Chairman, in my
experience in international organizations--and I think it is
true for others as well--the single most important thing is
American leadership, absolutely firm American leadership that
there will be no compromise on this question of keeping the
political question out, and that is--I believe it is very
important that Congress make its views on that clear.
Senator Thomas. I could not agree with you more. My concern
is that some kind of an amendment or several amendments that go
on this bill that keep this from happening.
I guess the real question--I do not know that anybody would
disagree with any of those things, religious freedom, all this
sort of stuff, but that is really not the issue. We all agree
with that. The issue is, how do we best bring about change in
the PRC? Do we do it by pushing them off and making it more
difficult, or do we insist on certain things as they move
forward? It seems to me that is the issue.
It is pretty easy to just complain and say we are not going
to do this, we are not going to do that, but if we want to
bring about change, then how do you do that?
Senator Kyl. Mr. Chairman, could I just make a quick
comment on that?
The Chairman. Sure.
Senator Kyl. There has been a lot of concern about the
PRC's willingness to abide by the rules of the WTO once it is
admitted to the organization, and that concerns me, too. I
think that over time it is useful for a country like the PRC to
be in a regime like this. Over time the hope is that it will
learn to live with the same rules that everybody else learns to
live with, and so for that reason, even though I am somewhat
skeptical about their initial willingness to comply with these
rules, I think that that is useful.
I think a good starting point is to make it clear to them
that they cannot dictate the words with respect to Taiwan's
accession, and that is why I agree with the President that he
says, their words are unacceptable, and we need to make it
clear.
Senator Thomas. Yes, I agree, and we ought to find a means
of doing that, and I think we can do that. I do believe
strongly, and this is one of the reasons I am a strong
supporter of it, I think we would have better luck and have a
better chance to deal with PRC over time.
So thank you, Mr. Chairman.
The Chairman. But how about Taiwan. Are we going to leave
them hanging, dry and high, and that is precisely what the
argument is among so many people who favor doing it now.
Now, does anybody believe that the House of Representatives
would balk at an amendment giving fair play to Taiwan, an
amendment to that effect? Would that kill the proposition?
Senator Thomas. I do not know, Mr. Chairman. Part of it, I
read about it, is the difficulty on timing and so on, but you
know--but I guess I would just respond I could not agree with
you more.
Listen, we have been committed to Taiwan, we are committed
to Taiwan. There is no question about that.
The Chairman. Except when the vote is involved on this
question.
Senator Thomas. I do not think that is the question
involved here. I think the process here is what you are talking
about, not our commitment, and I agree with Senator Kyl, we
need to find a way to get that message there, but I do not
think an amendment is--that is my view.
The Chairman. So what happens, I ask you, to Taiwan?
Mr. Bolton. Well, I think the risk of Congress not doing
something now is that at some point in the very near future,
let us say PNTR passes this month, goes into effect. The
resolution is adopted, and then the PRC actually joins the WTO,
and then, and only then--that is to say, once it is clearly a
member, and once PNTR has kicked in--then it says: ``we would
be delighted to have Taiwan in, except we want an explicit
acknowledgement it is a province of China.'' Then they are
already in. Then your leverage is gone.
I would just think as a bargaining matter you are in a
stronger position to do something now, just to have a very
simple----
The Chairman. You are exactly right.
Mr. Bolton [continuing]. Amendment that says: ``do what you
say you were going to do, stick to your commitment.''
Senator Thomas. Well, there is a list of bargaining issues
as long as your arm, you know that and so do I, so bring them
up--there is tons of them. Why do we not put them all on?
Mr. Bolton. Because I think this one, as I said in my
testimony, goes to the heart of the integrity of the World
Trade Organization itself.
Senator Thomas. Absolutely.
Mr. Bolton. If this one goes awry--this is not a human
rights question, it is not a WMD question, it is not a
religious freedom question. It is about whether the WTO will
work or not, and I think we have an interest in making the WTO
work. I fear what is going to happen if we allow this kind of
behavior from an entity that is not even in the WTO.
Senator Thomas. You are suggesting something is going to
happen that is not necessarily going to happen.
Mr. Bolton. I am worried based on----
Senator Thomas. I know you are worried, but that does not
make it happen.
Mr. Bolton. No, but I----
Senator Thomas. A lot of people are worried about other
things.
Mr. Bolton. I am worried about the position, and the
strength of the position of this administration. I think
Congress can measurably stiffen its spine.
Senator Thomas. I think we can, too. Let's find a way to do
it besides an amendment.
The Chairman. Well, the fact remains that Taiwan qualified
itself for admission to WTO years ago.
Mr. Bolton. I was going to say, Mr. Chairman, on that
point, if you look at the actual agreement in 1992, that was
probably a mistake then. It probably was a mistake for Taiwan
or the United States to conclude that we would allow the PRC to
enter first and Taiwan only to enter second. We should have
said they should enter when they are ready, irrespective of
political considerations, and had we done that Taiwan would
already be a member now.
Senator Thomas. Was the agreement you talk about ever
finalized?
Mr. Bolton. No, it was not, and it was an oral agreement,
and many people have questioned it from the beginning.
I am trying to be realistic, Senator, as I think you are,
and say we are not going to go back to 1992 and reopen that.
Let us take it for what it is and simply ask that the PRC agree
to what they agreed to.
Senator Thomas. But my point is, you indicated the
agreement in 1992. There was no agreement in 1992.
Mr. Bolton. There was certainly no written agreement, that
is correct, but I do not know of any person involved in trade
policy who has not referred to it as an agreement.
Senator Thomas. Sure, and I agree with you, and there are
26 countries, most of whom would agree with that.
The Chairman. Further comment.
Senator Kyl. Well, Mr. Chairman, I just hope that we can
find a way over the course of the next couple of weeks to stand
united for the proposition that Taiwan needs to come in under
the terms that the administration and the Congress believe is
appropriate, and that we should hold out the prospect of
legislative action to ensure that as one way for the
administration to nail it down.
And I would just suggest, and do this with all deference to
my colleague from Wyoming, that perhaps we could all be a
little bit less specific about what we may or may not do under
the circumstances. It could be that if there is an
understanding that Congress might well act legislatively if the
PRC is not willing to agree with the administration, if we are
able to hold out that possibility, then I think it likely that
the PRC will work with our administration.
But if we announce in advance that no matter what they do
we are still willing to grant them entry, then we have
certainly given up one element of legislative leverage, and
after all, it is the U.S. Congress that has this authority.
And, we could use it to help the administration right now, if
we will only do that.
The Chairman. John.
Mr. Bolton. Just one last bit of history. Congress has
acted in this way before. During the PLO's efforts to join the
World Health Organization in 1989, for example, it became clear
to us we were going to lose that fight unless we took some
pretty strong diplomatic action.
And my boss at the time, Jim Baker, issued a statement just
before the World Health Assembly where he said, ``I will
recommend to the President that the United States make no
further contributions, voluntary or assessed, to any
international organization which makes any change in the PLO's
present status as an observer organization.'' That was tough
language. That is using contributions as a weapon, and it
worked. Frankly, if Secretary Baker had not said that, we would
have lost.
Congress was not satisfied with that. Congress, after the
PLO failed to get into the World Health Organization, took
almost exactly that language and put it in statutory form to
say: ``it is not that we do not trust Jim Baker and President
Bush. We want to make it clear Congress has an independent view
of this.''
So Congress does this all the time.
The Chairman. Let me ask the three of you this. Suppose,
hypothetically, we did the right thing instead of playing
Chicken Little because of the heavy lobbying that has been done
on this, being honest about it, heavy contributors who in the
past perhaps have contributed to me--in the future they may
not, but that is up to them.
I think that this issue is so important that the Congress
ought to go ahead and do something in the Senate first about
Taiwan that is specific so it does have to go back to the
House, and I wonder how many House Members and how many Senate
Members would object to coming back after the election if the
schedule warrants it. If we are not willing to do that, we are
not very concerned about Taiwan. I think we ought to stand up
for Taiwan now, and not in some vague future time.
Any further comment or response?
Senator Kyl. Mr. Chairman, I have personally visited with
your former colleague and my friend, Barry Goldwater, about
Taiwan, and he impressed upon me many times before his death
the importance of that relationship. I would feel duty bound to
do whatever I could to ensure nothing but fairness, which we
have all agreed on here, and if that required us to come back,
that would certainly be no problem for me.
I think that Senator Thomas has rightly pointed out that
there is a risk, if we are hoping to do this before the
election, but I actually believe that because there is such
strong support both for WTO admission for the PRC and for
Taiwan, it would not take long at all for that one change to be
approved.
I understand there is a risk trying to do it before the
election, and that that is of concern to people, but I also
believe that sometimes matters of principle are so important
here that a little bit of extra time that it may take is worth
it, and I would be willing to do whatever it took to ensure
that Taiwan comes in under the right terms.
The Chairman. That is precisely the point. If there be no
further business to come before the committee, we stand in
recess.
[Whereupon, at 11:23 a.m., the committee adjourned.]
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