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  •   U.S. Says Trade Deficit Growth With China Is 'Unacceptable'

    By Steven Mufson
    Washington Post Foreign Service
    Thursday, October 9, 1997; Page A31

    Visiting Commerce Secretary William Daley warned China again today that the rapid growth in the U.S. trade deficit with Beijing is "just unacceptable," and China announced that it will soon send a group on a major buying mission to the United States.

    "To reduce the trade imbalance, China will send a purchasing group to the United States soon to sign substantial economic contracts," the government-run English-language China Daily quoted Wu Yi, minister of foreign economic relations and trade, as telling Daley on Tuesday.

    Today, Daley said that U.S. exports to China are growing at a "pathetic pace" compared with the rate of China's economic boom. In a speech to the American Chamber of Commerce here, Daley said U.S. exports to China rose just 2 percent in 1996 compared with a 13 percent hike in U.S. imports from China.

    On Thursday Daley is expected to witness the signing of some contracts with American firms, including possible sales of telecommunications equipment and 30 Boeing aircraft.

    Daley arrived here Tuesday for three days of talks to work out trade issues, which could be thorny topics for this month's summit meeting in Washington between President Clinton and China's President Jiang Zemin. Daley, who met with Jiang today, said the U.S. trade gap with China will widen this year to $44 billion, up from $40 billion last year and second only to the U.S. trade deficit with Japan. Because it excludes goods that pass through the busy port of Hong Kong, China says the trade deficit figure is closer to $10 billion.

    "It's just unacceptable to have these sorts of trends continue," Daley told the American business executives. "What these figures say is that the Chinese market has yet to open. The trends have just got to change."

    China blamed the United States for the substantial trade gap.

    "The most direct and simple means to solve the problems in bilateral trade is for China to be admitted to the World Trade Organization," the China Daily quoted Wu as telling Daley. Wu also called on Daley to halt the annual review of China's most-favored-nation trading status.

    "Permanent MFN status is not only beneficial for Sino-U.S. commercial ties, but also for long-term U.S. interests in China," Wu was quoted as saying.

    In his speech today, however, Daley reiterated that China would only be allowed into the trade organization when it opened its market further on terms similar to nations that are members of the group. Daley also said that before ending the annual review of China's trade status there would "have to be movement on a whole host of areas," such as human rights and arms control.

    © Copyright 1997 The Washington Post Company

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