Great leap forward in Sino-US trade ties

THE US yesterday promised 'aggressive' support for American business in China now that the link between trade and human rights issues has been severed. Ron Brown, the Secretary of Commerce, told US businessmen in Peking: 'I don't want a level playing field, I want a tilted playing field, I want it tilted towards us.'

Marking what he called a 'historic juncture' in Sino-US relations, Mr Brown spent a hectic day shuttling between meetings with Chinese leaders and signing ceremonies for US companies, sealing a raft of new contracts.

Mr Brown is the first US cabinet member to visit China since President Bill Clinton's decision in May to separate renewal of China's low-tariff Most Favoured Nation (MFN) trading status from human rights issues. US officials said the mission would 'lay the basis for a long-term commercial relationship' between the two countries.

In a speech to the American Chamber of Commerce in Peking, the Commerce Secretary said the administration's new policy was 'relentlessly pragmatic. We are bottom-line oriented.' In particular, he said the US government would now match concessionary loan packages and 'tied aid' that have been used successfully by European governments, particularly Germany and France, to win contracts in China. The US and China yesterday also signed a broad trade framework to promote co-operation in key industrial sectors.

This week will see the first results of Washington's 'commercial diplomacy'. The high-level US delegation includes the chief executive officers from 24 leading US corporations who, over the coming days, are expected to sign 'a few billion' dollars worth of deals. Yesterday, Westinghouse clinched a dollars 140m ( pounds 90m) power plant contract, telecommunications company Pitney Bowes signed a dollars 20m deal, and IBM sealed a dollars 20m agreement.

Meanwhile, senior delegation officials were on the defensive last night over whether human rights had now been sidelined as an issue in Sino-US relations. 'Of course, human rights issues arose as well,' said a Commerce Department official. Mr Brown had raised the matter privately at all top-level meetings, but it was 'not appropriate' to mention what was discussed. He added that Mr Brown's mission was concentrating on the 'commercial engagement aspect' of the US human rights policy, which also contained other elements.

On Saturday, the day Mr Brown's party arrived in China, the authorities detained a leading pro-democracy activist, Wang Dan, for a few hours after he had complained of being hounded by the police.

Less than six months ago, in the run-up to President Clinton's MFN decision, the US Secretary of State, Warren Christopher, was shunned by China's leaders during a visit to Peking. Yesterday, with human rights further down the agenda, Mr Brown's reception was extremely cordial. The Chinese Prime Minister, Li Peng, told Mr Brown: 'We have waited a long time for you to come to China. I hope that your current visit will provide impetus for friendship and co-operation of our two countries.'

The Commerce Secretary's Chinese counterpart, Wu Yi, said Mr Brown had received 'the highest courtesy' in China. Today, when he meets President Jiang Zemin, Mr Brown will deliver a private letter from Mr Clinton.

The one area of evident friction yesterday remained differences of opinion over the timing of China's re-entry to the General Agreement on Tariffs and Trade (Gatt). Peking wants to join by the end of the year but the US remains concernd about a range of issues, including intellectual property, tariff and non-tariff barriers, the transparency of China's trading system and discrimination against foreign companies.

British business will be looking with envy at the results of Mr Brown's efforts to kick-start US trade and investment in China. Next month a high-level British trade delegation is due in China but Sino-British relations remain dogged by the dispute over political reform in Hong Kong.