Policy: NSC's Sandra Kristoff on Asia Economic Situation Third in a Series on U.S. Trade Policy

BG9809E | Date: 1998-04-30

Sandra Kristoff, Special Assistant to the President for the Economic Situation in Asia and Senior Director for Asian Programs, National Security Council, gave an on-the-record briefing at USIA's Foreign Press Center March 20, 1998. Ambassador Kristoff discussed the Clinton Administration's view of the current economic situation in Asia. Following are excerpts from the briefing related to U.S. policy toward Taiwan.

Q: Two questions regarding China's WTO accession talks. First, you mention that the United States is expecting China to follow through on its commitment not to devalue the renminbi. Lately rumors suggest that China might use its promise to not devalue its currency to gain leverage or concessions from the United States. The second question is, some reports from Taiwan suggest that the U.S. is playing the Taiwan card again -- you reach a WTO agreement with Taiwan in order to push China. What is the latest U.S. policy in terms of WTO accession for both sides of the Taiwan Strait?

KRISTOFF: Let me answer the first question. The issue of the Asia financial crisis and what we have to do as an international community, using organizations like the IMF and then various countries in the region, contributions that each of us can make to restore stability -- this is not something that is a negotiating chip among any of us, frankly. There has been extremely close coordination among all of the major players in the region to try to come up with coherent and consistent policies and practices and actions that we can take to help restore financial stability. So I think to suggest that any one country is using someone else's crisis as a negotiating chip is not accurate.

As for Taiwan and WTO, we did conclude with Taiwan the U.S. bilateral negotiation on Taiwan's accession. I think that that negotiation had been going for seven years, as I recollect. It was probably time to finish it -- if we couldn't reach agreement in seven years on these items, I suppose it would have taken 77 years. So I think the negotiation just came down to a handful of issues. It was time to wrap those issues up, and the two sides were able to do that. We have always said and the United States government position remains that an applicant's package for accession should be judged on its merits, and that is what we intend to do, as part of the working party process in Geneva. I would note that Taiwan has not finished its working party negotiations in Geneva, so its entire accession package is not yet ready for tabling before June.

Q: Then how about Fisher's remark in Beijing? I heard that people at the USTR dispute his remarks. In his response to the question of whether Taiwan or Beijing would be allowed in first, he said that whoever is ready should be allowed in. I guess that was not the understanding, if you will, among the members. So does this reflect some consideration by the Administration?

KRISTOFF: I'm not aware of what Ambassador Fisher's comment was. Let me say that our position remains that applications should be looked at on their merits. To get into the WTO there has to be a consensus among the WTO member states. I think most analysts believe it is highly unlikely that there will be a WTO-wide consensus for Taiwan's admission in advance of China. And that reflects not a U.S. government position but an assessment of when a consensus would emerge in Geneva. So this is not a U.S.-driven issue, frankly.

Q: Ambassador Kristoff, while U.S.-China relations seem to be warming up, there have been a couple of important meetings between administration officials and Taiwanese officials, such as the Secretary-General of Taiwan's NSC, and Taipei Mayor Mr. Chen Shui-bian, a presidential hopeful. What are the kind of messages the Administration is trying to put across to the Taiwanese government? My second question is: Is the U.S. channel of communication with Taiwan more effective now, compared to before 1996?

KRISTOFF: I think the U.S. relationship with Taiwan follows pretty closely the policy of unofficial relations that we have, as established under the Taiwan Relations Act.

We do, from time to time, have consultations across the board with Taiwan, from security and political issues to economic issues. Again, that's usually under the rubric of the American Institute in Taiwan, which is the construct that we've got.

There's no one single message that we've delivered to Taiwan in these discussions. I think if I had to point to one issue between Taiwan and China that the United States would like to see move forward, that would be cross-strait dialogue. And I think we've said equally loud and vigorously to both Beijing and Taipei, that it is the Taipei-Beijing dialogue that would do the most to reduce tension in the region.

As to the effectiveness of U.S.-Taiwan consultations, certainly when Jason Hu was here, and now he's back in Taipei, he had a very open dialogue here in Washington. His replacement, Steve Chen, is an old colleague of many of the people in the U.S. Administration. So, I think there's an easy conversation and dialogue there as well.

Q: Sandy, just following on your last point there, on cross-straits dialogue. Over the past several weeks, there have been a number of reports about proposals flying between Beijing and Taipei, on setting up another attempt at cross-strait dialogue. I wonder if you could give us your assessment of that, where you think it might go, what has prompted it, and what the role of former administration officials like Tony Lake and William Perry has been in relaunching that process?

KRISTOFF: The flurry of activity across the Strait, and exchanges of questions and proposals and ideas and people, between Beijing and Taipei -- I think it's very hopeful. And I think that we can now begin to expect the cross-strait dialogue to actually resume. And very high officials within Taiwan have said positive things particularly on points about reunification.

Beijing as well has reached out, and particularly in the way it's approached the question of discussion of political issues between Beijing and Taipei. So I think we're beginning to be a little bit more upbeat about the expectation of cross-strait dialogue.

I don't think people like William Perry or Tony Lake have gone to Taipei, or to Beijing, for that matter, carrying messages from the U.S. Administration. We have not used former Secretary Perry or Tony as envoys in any way, shape, manner, or form. The speech that Lake recently made in Taiwan was a very accurate and insightful description of how the U.S. approaches Taiwan, and where the Taiwan Strait crisis fit in all of that. And I had a chance to talk with him about that speech. It was well received in Taipei.

Secretary Perry and Brent Scowcroft and others who have gone to Beijing have continued to deliver the same message that all of us generally have delivered with China, that it's time for U.S.-China relations to improve. We need engagement across the board, we have to solve problems. The October summit gave us a real boost. The President's return trip in June can be a transforming event in U.S.-China relations.