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U.S. Ends Ban on China Trade; Items Are Listed

Curbs Lifted on Shipping to Red Bloc

By Carroll Kilpatrick
Washington Post Staff Writer
June 11, 1971

President Nixon opened another door to the resumption of more normal relations with China yesterday with an order permitting trade in a long list of nonstrategic items.

At the same time, the President cleared the way for larger farm exports to the Soviet bloc by terminating a requirement imposed by President Kennedy that half of grain and flour shipments to Communist countries be carried in American ships.

The President's action lifts a 21-year-old embargo against trade with China permitting selected exports to China and the import of goods from China on the same basis goods from other Communist countries are admitted.

Following a series of other steps taken in recent months to improve relations with the Chinese, the President's announcement is considered a prelude to an ending later this year of U.S. opposition to the seating of Peking in the United Nations, provided that Taiwan is not expelled.

Under the new order, U.S. exporters will be free to sell to China most farm, fish and forestry products, fertilizers, coal, selected chemicals and metals, passenger cards, agricultural, industrial and office equipment and certain electronic and communications equipment.

The President's order does not remove the prohibition against the shipment of locomotives to China, one of the key items the Peking government is said to want, and of aircraft.

Defense department officials opposed lifting the ban on most heavy transportation equipment with the argument it could be used in helping Communist troops in Vietnam.

The President accepted the argument, but officials said that the list of goods still on the strategic list would be under constant review and that changes would be made from time to time.

An exporter may apply to the Commerce Department for a license to ship a locomotive or any other item on the strategic list, and the White House held out some hope that exceptions may be made from time to time.

"Items not on the open general list may be considered for specific licensing consistent with the requirements of U.S. national security," the White House statement said.

The big surprise of the President's announcement was his termination of the requirement that half of the shipment of grain and flour to Communist nations be carried in American ships.

AFL-CIO President George Meany promptly criticized the President's decision, calling it a "breach of faith and an unwarranted blow at the livelihoods of American seafaring men."

Secretary of Agriculture Clifford M. Hardin cautioned that farmers should not expect big increases in grain exports immediately.

"We hope it will eventually result in meaningful trade for farm exports along with products from American industry," Hardin said. "We do not anticipate significant trade developments with either China or the Soviet Union in the immediate future."

But Hardin hailed the President's action as a "constructive step" that will ultimately benefit American farmers.

U.S.-China trade was roughly $200 million annually in 1950 when President Truman imposed an embargo after China entered the Korean War on the North Korean side.

China's total world trade now totals about $2 billion in exports and the same in imports with about $1.5 billion from non-Communist countries, the bulk of it from Japan.

White House press secretary Ronald Ziegler said that the President looks upon these new measures "as a significant step in improved communications with a land of 800 million people after a 20-year freeze in our relations."

"The President will later consider the possibility of further steps in an effort to reestablish a broader relationship with a country and people having an important role for future peace in Asia."

The list of strategic goods which may be freely shipped to Mainland China does not include such items as petroleum products, navigation and tele-communication equipment and machinery for wielding large pipes in addition to locomotives.

These goods may be shipped to the Soviet Union, however. They constitute the main difference between the list of goods available for export to the Soviet Union and Eastern Europe and those still requiring an export license as far as China is concerned.

Some experts have argued that Peking will not be responsive to the new possibilities of trade with the United States since the list is more favorable to the Soviet Union.

Administration officials were sensitive to this criticism and discounted the differences between the two lists as insignificant.

The President's announcement said that he was taking "the first broad steps in termination of U.S. controls on a large list of non-strategic U.S. exports to the People's Republic of China."

In the future, products listed as non-strategic may be freely sold to China under open general export licenses without the need to obtain Department of Commerce permission for each specific transaction," the statement said.

On April 14, Mr. Nixon announced a five-point program designed to "create broader opportunities for contacts between the Chinese and American peoples." These included a promise to expedite the issuance of visas to permit Chinese visitors to the United States, a relaxation of currency controls to permit Peking's use of American dollars and the removal of restrictions prohibiting American oil companies from providing fuel to Chinese merchant ships.

On April 19, in an interview at a meeting of the American Society of Newspaper Editors, the President said the question of trade with the Chinese is "up to them."

"If the want to trade ... we are ready," he said. "If they want to have Chinese come to the United States, we are ready. We are also ready for Americans to go there, Americans in all walks of life.

"But it take two, of course. We have taken several steps. They have taken one inviting the American table tennis team to Peking. We are prepared to take other steps in the trade field and also with regard to the exchange field, but each step must be taken one step at a time.

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