Text: U.S. Policy in the Asia-Pacific Region Remarks by U.S. Secretary of State Warren Christopher before the Business Council
I am particularly pleased to have the chance to speak with you about the dynamic Asia-Pacific region. As a young naval officer in the Pacific in World War II, chairman of a Los Angeles-based law firm with Asian offices, a one-time trade negotiator with Japan, and now Secretary of State, I have had the opportunity to witness -- up close and personal -- many of Asia's remarkable changes over the last half-century.
With all due respect to the proponents of a coming "Asian Century," I am bold enough to believe that it will also be the second American Century as well. As a global power with global interests, the United States has a great stake in the region's dynamism, and we have the greatest ability to sustain it in ways that benefit the American people and the world.
Let me make a few observations about the impact of this new era on the way in which we pursue our national interests.
First, accelerated change means that no company or country can take its leadership for granted. The United States won the Cold War, but as Peter Drucker has written, no company -- or country -- is automatically destined to be a permanent economic superpower in the new global marketplace. We have to keep on our toes and be light on our feet.
Second, one of the most dramatic changes I have seen is the erasure of the line between domestic and foreign policy -- just as in the corporate world you no longer see a bright line between a company's domestic and foreign operations. The Clinton Administration recognizes that our strength at home and abroad are inseparable -- and that our ability to create jobs and growth here depends on our ability to open markets overseas. I believe that one of the signature accomplishments of our Administration will be a landmark set of market-opening agreements -- from GATT and NAFTA to APEC and the Free Trade Agreement of the Americas.
Third, our economic diplomacy is not only essential to advancing our commercial interests but is also a powerful tool for achieving other core foreign policy goals. Economic development is essential to undergird peace, stability and progress toward democracy -- whether in the Middle East, Haiti, or the Newly Independent States of the former Soviet Union. Just as surely as our military might and our embassies overseas advance our interests, your companies' global presence extends American power and influence. Our late and much-admired colleague Ron Brown understood this concept well, and we will certainly all miss him for that and many other reasons.
Nowhere is the mutually reinforcing relationship between our economic and security interests more apparent than in the Asia-Pacific region. For the last half-century, America's military presence in Asia has provided the foundation of stability for nations to build thriving economies for the benefit of all.
There should be absolutely no doubt that we intend to remain a Pacific power. During the last three years, President Clinton has taken a number of key strategic decisions to reinforce our engagement in the region -- through our five active security alliances, our forward-deployed presence, and our commitment to maintain approximately 100,000 troops in the Pacific.
The cornerstone of our engagement in the region, of course, remains our relationship with Japan. Here as elsewhere, this Administration has defied the skeptics and demonstrated that we can promote America's economic interests while strengthening our vital security relationships at the same time.
The Joint Declaration signed by the President and Prime Minister Hashimoto in Tokyo last month provides the firm foundation to ensure that our alliance can meet the challenges of the next century. Japan has agreed to increase its financial and material support for our troops stationed there. In addition, we are working well with Japan in areas such as Bosnia and the Middle East.
Our economic relationship with Japan is also becoming more balanced. Since 1993, U.S. exports to Japan have risen by 34 percent, with increases as high as 80 percent in the sectors where trade agreements have been reached. Our trade deficit fell last year by almost 10 percent from its level in 1994 -- the first time since 1990 that our bilateral trade deficit has decreased.
This progress is due to a variety of factors -- including the persistent efforts of your companies to gain footholds in Japanese markets. But there can be no doubt that it is also due to our determined efforts to open markets. Over the last three years, we have reached 21 separate market access agreements with Japan in sectors as diverse as autos and auto parts, agriculture, telecommunications and medical technology. We will be vigilant in ensuring the implementation of existing agreements -- and in resolving outstanding trade disputes in areas such as film, semiconductors and insurance. And we will press for further deregulation of Japan's economy, which will benefit Japanese consumers as well as American and other foreign businesses.
Of course, no nation is playing a larger role in shaping the future of Asia than China. How our relationship with China develops will have a vast impact on our future. Nobody should have any illusions about the difficulty of dealing with this emerging power during a time of transition. But nobody should have any doubt about how important a stable, open and prosperous China is to our interests. What is vital is keeping a clear eye on our strategic interest in moving China in that direction. Your companies' capital, technology and ideas are already playing a critical role in integrating China into the mainstream of the global economy and the international community.
The United States shares an array of important interests with China -- and we have worked hard over the last three years to advance them. I have met with my counterpart Vice Premier and Foreign Minister Qian Qichen 13 times since I became Secretary of State. We have been able to work together to extend the Nuclear Non-proliferation Treaty, and to resolve the threat posed by the North Korean nuclear program. We have engaged with China in our effort to ban nuclear testing, to fight drug trafficking and alien smuggling and to protect the environment.
When we have problems with China's actions, we have pressed our interests candidly and forcefully. As you know, we have stressed to China the importance of fully implementing the agreement on protecting intellectual property rights that we concluded in March 1995. The piracy of CDs, videos, and software is growing, causing billions of dollars in losses to American companies. The President has made it clear that if the Chinese do not deal with this IPR piracy, we will have no choice but to go ahead with a carefully targeted but quite substantial list of sanctions provided for by U.S. law.
We will continue to pursue our interests vigorously, whether the issue is security, trade, non-proliferation or human rights. Last month, for example, we sent an unmistakable signal to China that the use of force across the Taiwan Strait would be a matter of grave concern to the United States.
But we reject the counsel of those who seek to contain or isolate China. Far from protecting our interests, such a course would harm them.
It is in this broad context that we will be supporting the continuation of MFN for China once again next month. The President and I will make the case that the best way to advance our interests is to maintain our engagement -- an approach pursued by six presidents and now endorsed, I am pleased to note, by Senator Dole. Revoking or conditioning MFN now would not advance human rights in China. But it would damage our economy -- and harm Hong Kong and Taiwan, and other Asian allies and friends. That is why Hong Kong legislative leader Martin Lee and Governor Chris Patten, with whom I met yesterday morning, support MFN's unconditional renewal.
Our alliance with South Korea is also another vital relationship. During the last three years, we have developed an unprecedented degree of cooperation. Our strong partnership enabled us to forge an agreement to freeze North Korea's dangerous nuclear program and put it on course for dismantlement. We have also made great commercial progress in what is now our fifth largest export market. We expanded our exports last year by 40 percent -- and now have a trade surplus.
As you know, to reach a durable peace on the Peninsula, President Clinton and President Kim Young Sam recently offered a proposal for four-party talks among the United States, South Korea, North Korea and China. China has said that the proposal is "reasonable" and that it will participate if North Korea does. North Korea, for its part, has indicated that it is seriously studying the proposal.
The nations of ASEAN -- Singapore, Indonesia, Malaysia, Thailand, the Philippines, Brunei, and now Vietnam -- are essential to our security and economic interests in Asia. Their rapidly growing markets collectively represent our fourth largest trading partner. We are working hard in Southeast Asia to protect intellectual property rights, promote U.S. investment, and expand U.S. exports, which rose by more than 10 percent in 1994.
Like any other region, the Asia-Pacific region has its share of problems that make the business environment difficult. As Secretary, one of my top priorities has been to fight the corrupt practices that I know cost American companies billions of dollars in orders and contracts every year. In late 1993, I launched a global initiative through the OECD to unite supplier nations to end illicit payments. I am delighted that we have reached agreement to prevent bribes paid to foreign officials from being tax-deductible as a business expense. I hope they will soon be outlawed altogether. In a parallel effort, I have also intensified our efforts through APEC to increase the transparency of bidding practices in government procurement in this region -- where as you know there will be such massive demand over the next two decades.
During the last three years, this Administration has placed an unprecedented emphasis on our interlocking strategic and economic interests in Asia and around the world. We will continue to work with you to seize the opportunities that Asia has to offer -- opportunities that are so critical to America's future.
With all due respect to the proponents of a coming "Asian Century," I am bold enough to believe that it will also be the second American Century as well. As a global power with global interests, the United States has a great stake in the region's dynamism, and we have the greatest ability to sustain it in ways that benefit the American people and the world.
Let me make a few observations about the impact of this new era on the way in which we pursue our national interests.
First, accelerated change means that no company or country can take its leadership for granted. The United States won the Cold War, but as Peter Drucker has written, no company -- or country -- is automatically destined to be a permanent economic superpower in the new global marketplace. We have to keep on our toes and be light on our feet.
Second, one of the most dramatic changes I have seen is the erasure of the line between domestic and foreign policy -- just as in the corporate world you no longer see a bright line between a company's domestic and foreign operations. The Clinton Administration recognizes that our strength at home and abroad are inseparable -- and that our ability to create jobs and growth here depends on our ability to open markets overseas. I believe that one of the signature accomplishments of our Administration will be a landmark set of market-opening agreements -- from GATT and NAFTA to APEC and the Free Trade Agreement of the Americas.
Third, our economic diplomacy is not only essential to advancing our commercial interests but is also a powerful tool for achieving other core foreign policy goals. Economic development is essential to undergird peace, stability and progress toward democracy -- whether in the Middle East, Haiti, or the Newly Independent States of the former Soviet Union. Just as surely as our military might and our embassies overseas advance our interests, your companies' global presence extends American power and influence. Our late and much-admired colleague Ron Brown understood this concept well, and we will certainly all miss him for that and many other reasons.
Nowhere is the mutually reinforcing relationship between our economic and security interests more apparent than in the Asia-Pacific region. For the last half-century, America's military presence in Asia has provided the foundation of stability for nations to build thriving economies for the benefit of all.
There should be absolutely no doubt that we intend to remain a Pacific power. During the last three years, President Clinton has taken a number of key strategic decisions to reinforce our engagement in the region -- through our five active security alliances, our forward-deployed presence, and our commitment to maintain approximately 100,000 troops in the Pacific.
The cornerstone of our engagement in the region, of course, remains our relationship with Japan. Here as elsewhere, this Administration has defied the skeptics and demonstrated that we can promote America's economic interests while strengthening our vital security relationships at the same time.
The Joint Declaration signed by the President and Prime Minister Hashimoto in Tokyo last month provides the firm foundation to ensure that our alliance can meet the challenges of the next century. Japan has agreed to increase its financial and material support for our troops stationed there. In addition, we are working well with Japan in areas such as Bosnia and the Middle East.
Our economic relationship with Japan is also becoming more balanced. Since 1993, U.S. exports to Japan have risen by 34 percent, with increases as high as 80 percent in the sectors where trade agreements have been reached. Our trade deficit fell last year by almost 10 percent from its level in 1994 -- the first time since 1990 that our bilateral trade deficit has decreased.
This progress is due to a variety of factors -- including the persistent efforts of your companies to gain footholds in Japanese markets. But there can be no doubt that it is also due to our determined efforts to open markets. Over the last three years, we have reached 21 separate market access agreements with Japan in sectors as diverse as autos and auto parts, agriculture, telecommunications and medical technology. We will be vigilant in ensuring the implementation of existing agreements -- and in resolving outstanding trade disputes in areas such as film, semiconductors and insurance. And we will press for further deregulation of Japan's economy, which will benefit Japanese consumers as well as American and other foreign businesses.
Of course, no nation is playing a larger role in shaping the future of Asia than China. How our relationship with China develops will have a vast impact on our future. Nobody should have any illusions about the difficulty of dealing with this emerging power during a time of transition. But nobody should have any doubt about how important a stable, open and prosperous China is to our interests. What is vital is keeping a clear eye on our strategic interest in moving China in that direction. Your companies' capital, technology and ideas are already playing a critical role in integrating China into the mainstream of the global economy and the international community.
The United States shares an array of important interests with China -- and we have worked hard over the last three years to advance them. I have met with my counterpart Vice Premier and Foreign Minister Qian Qichen 13 times since I became Secretary of State. We have been able to work together to extend the Nuclear Non-proliferation Treaty, and to resolve the threat posed by the North Korean nuclear program. We have engaged with China in our effort to ban nuclear testing, to fight drug trafficking and alien smuggling and to protect the environment.
When we have problems with China's actions, we have pressed our interests candidly and forcefully. As you know, we have stressed to China the importance of fully implementing the agreement on protecting intellectual property rights that we concluded in March 1995. The piracy of CDs, videos, and software is growing, causing billions of dollars in losses to American companies. The President has made it clear that if the Chinese do not deal with this IPR piracy, we will have no choice but to go ahead with a carefully targeted but quite substantial list of sanctions provided for by U.S. law.
We will continue to pursue our interests vigorously, whether the issue is security, trade, non-proliferation or human rights. Last month, for example, we sent an unmistakable signal to China that the use of force across the Taiwan Strait would be a matter of grave concern to the United States.
But we reject the counsel of those who seek to contain or isolate China. Far from protecting our interests, such a course would harm them.
It is in this broad context that we will be supporting the continuation of MFN for China once again next month. The President and I will make the case that the best way to advance our interests is to maintain our engagement -- an approach pursued by six presidents and now endorsed, I am pleased to note, by Senator Dole. Revoking or conditioning MFN now would not advance human rights in China. But it would damage our economy -- and harm Hong Kong and Taiwan, and other Asian allies and friends. That is why Hong Kong legislative leader Martin Lee and Governor Chris Patten, with whom I met yesterday morning, support MFN's unconditional renewal.
Our alliance with South Korea is also another vital relationship. During the last three years, we have developed an unprecedented degree of cooperation. Our strong partnership enabled us to forge an agreement to freeze North Korea's dangerous nuclear program and put it on course for dismantlement. We have also made great commercial progress in what is now our fifth largest export market. We expanded our exports last year by 40 percent -- and now have a trade surplus.
As you know, to reach a durable peace on the Peninsula, President Clinton and President Kim Young Sam recently offered a proposal for four-party talks among the United States, South Korea, North Korea and China. China has said that the proposal is "reasonable" and that it will participate if North Korea does. North Korea, for its part, has indicated that it is seriously studying the proposal.
The nations of ASEAN -- Singapore, Indonesia, Malaysia, Thailand, the Philippines, Brunei, and now Vietnam -- are essential to our security and economic interests in Asia. Their rapidly growing markets collectively represent our fourth largest trading partner. We are working hard in Southeast Asia to protect intellectual property rights, promote U.S. investment, and expand U.S. exports, which rose by more than 10 percent in 1994.
Like any other region, the Asia-Pacific region has its share of problems that make the business environment difficult. As Secretary, one of my top priorities has been to fight the corrupt practices that I know cost American companies billions of dollars in orders and contracts every year. In late 1993, I launched a global initiative through the OECD to unite supplier nations to end illicit payments. I am delighted that we have reached agreement to prevent bribes paid to foreign officials from being tax-deductible as a business expense. I hope they will soon be outlawed altogether. In a parallel effort, I have also intensified our efforts through APEC to increase the transparency of bidding practices in government procurement in this region -- where as you know there will be such massive demand over the next two decades.
During the last three years, this Administration has placed an unprecedented emphasis on our interlocking strategic and economic interests in Asia and around the world. We will continue to work with you to seize the opportunities that Asia has to offer -- opportunities that are so critical to America's future.