U.S.-China Relations: Policy Issues
Susan V. Lawrence
Analyst in Asian Affairs
Thomas Lum
Specialist in Asian Affairs
January 12, 2011
Congressional Research Service
7-5700
www.crs.gov
R41108
CRS Report for Congress
P
repared for Members and Committees of Congress
U.S.-China Relations: Policy Issues
Summary
As China’s economy has expanded to become the second largest in the world, and as China’s
geopolitical clout has grown commensurately, the United States has sought to broaden the U.S.-
China relationship to encompass a wide range of global and regional issues. Among the global
issues on which the Obama Administration has sought to work with China are the international
financial crisis, climate change, and nuclear non-proliferation. In remarks in July 2009, President
Obama declared that partnership between the United States and China was “a prerequisite for
progress on many of the most pressing global challenges.” Continuing major bilateral issues in
the relationship include trade and investment concerns, human rights, and Taiwan.
Two years into the Obama Administration, U.S. officials point to some successes in their efforts
to work with China on global issues, including coordination of stimulus spending to address the
global financial crisis and cooperation in negotiating new sanctions against Iran and North Korea
over their nuclear programs. U.S. officials continue, however, to urge China to shoulder more
responsibility for addressing challenges that affect the broad international community. For their
part, many Chinese elites view such calls with suspicion, fearing that the West is intent on making
China take on responsibilities for which it is unprepared in order to slow China’s rise. In the 112th
Congress, interest is expected to remain strong in such issues as China’s currency policy,
cooperation on climate change, competition between the U.S. and Chinese militaries in Asia, U.S.
and Chinese policy toward Taiwan, conditions in Tibet, and the fate of China’s political prisoners.
The bilateral relationship was characterized by significant discord in 2010. China voiced
unhappiness over U.S. arms sales to Taiwan; President Obama’s meeting with Tibet’s exiled
spiritual leader, the Dalai Lama; U.S. joint military exercises with South Korea in the Yellow Sea;
the U.S. declaration of a “national interest” in freedom of navigation in the South China Sea; and
U.S. statements of support for Japan in a China-Japan spat involving a maritime collision near
disputed islands in the East China Sea. The United States voiced frustration with China’s currency
policy; its reluctance to condemn North Korean provocations; its expansive claims to disputed
territory in the South China Sea; its sharp escalation of pressure against Japan after the maritime
collision in the East China Sea; and its ongoing suppression of dissent. With China’s President
and Communist Party General Secretary Hu Jintao scheduled to make a state visit to Washington,
DC, on January 19, 2011, however, both countries ended the year seeking to re-focus on their
common interests.
The first part of this report provides an overview of the U.S.-China relationship and Obama
Administration policy toward China, with a detailed examination of the 2009 U.S.-China Joint
Statement. It also provides an introduction to U.S.-China dialogues and U.S. assistance programs
in China. This part of the report ends with a summary of aspects of Chinese foreign policy of
relevance to the U.S.-China relationship. The second part of the report summarizes major policy
issues in the relationship, beginning with economic issues, and continuing with climate change
and clean energy cooperation, human rights, security issues, and Taiwan. The report includes two
appendices, one listing congressionally mandated annual reports related to China, and the other
listing China-related legislation introduced in the 111th Congress. Throughout, this report directs
the reader to other CRS reports for more detailed information about individual topics. This report
will be updated periodically.
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U.S.-China Relations: Policy Issues
Contents
Overview of U.S.-China Relations .............................................................................................. 1
Obama Administration Policy...................................................................................................... 2
The 2009 U.S.-China Joint Statement .......................................................................................... 4
U.S.-China Dialogues.................................................................................................................. 5
U.S. Assistance Programs in China.............................................................................................. 7
China’s Foreign Policy................................................................................................................ 7
China’s “Soft Power” in the Developing World ..................................................................... 9
Selected Policy Issues ................................................................................................................. 9
Economic Issues ................................................................................................................... 9
Global Rebalancing....................................................................................................... 10
China’s Currency Policy................................................................................................ 11
The Bilateral Trade Deficit ............................................................................................ 11
China’s Holdings of U.S. Treasuries .............................................................................. 12
China’s Compliance with World Trade Organization Commitments ............................... 12
China’s “Indigenous Innovation” Policies...................................................................... 13
China’s Enforcement of Intellectual Property Rights (IPR) ............................................ 13
Safety of Chinese Products............................................................................................ 14
Climate Change and Clean Energy Cooperation .................................................................. 14
Human Rights Issues........................................................................................................... 16
Nobel Laureate Liu Xiaobo ........................................................................................... 19
Tibet ............................................................................................................................. 20
Xinjiang........................................................................................................................ 21
Security Issues .................................................................................................................... 22
Nuclear Non-Proliferation ............................................................................................. 22
Chinese Military Modernization.................................................................................... 24
U.S.-China Military-to-Military Relations ..................................................................... 25
Maritime Disputes......................................................................................................... 26
Taiwan ................................................................................................................................ 28
Cross-Strait Relations.................................................................................................... 30
U.S. Arms Sales to Taiwan ............................................................................................ 30
Tables
Table 1. Bilateral Meetings Between President Barack Obama and Chinese President Hu
Jintao ....................................................................................................................................... 6
Table A-1. Selected Executive Branch Reports to Congress on China ........................................ 32
Table A-2. Selected Executive Branch Reports to Congress Related to China ............................ 33
Table A-3. Selected Reports on China By Congressionally-Mandated Commissions .................. 34
Table B-1. Economic Legislation Related to China .................................................................... 35
Table B-2. Human Rights Legislation Related to China ............................................................. 36
Table B-3. Environment/Energy Legislation Related to China ................................................... 38
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Table B-4. Other Legislation Related to China........................................................................... 38
Appendixes
Appendix A. Congressionally-Mandated Annual Reports Related to China ................................ 32
Appendix B. Legislation Related to China Introduced in the 111th Congress .............................. 35
Contacts
Author Contact Information ...................................................................................................... 39
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Overview of U.S.-China Relations
After 30 years of fast-paced economic growth, China, also known by its formal name, the
People’s Republic of China (PRC), has emerged as the world’s second largest economy, and the
United States-China relationship, once focused on a relatively narrow range of bilateral concerns,
has expanded to encompass a broad range of global, regional, and bilateral issues. Washington
seeks Beijing’s cooperation in rebalancing the global economy and in resolving bilateral barriers
to trade and investment. With the United States and China now the two largest emitters of
greenhouse gases, Washington also seeks China’s cooperation in reaching international agreement
on steps to address climate change. Washington is looking to China, a fellow permanent member
of the United Nations Security Council, to help block the nuclear ambitions of Iran and North
Korea. It also urges China to help uphold peace and stability in the Asia-Pacific, including in the
Taiwan Strait, the South China Sea, and the East China Sea. The United States seeks to engage
China on the subject of Chinese overseas investments and foreign aid, which in some cases may
be undermining U.S. foreign policy interests, as in Burma and Sudan. The United States also
seeks to promote human rights and rule of law in China, including in the sometimes restive ethnic
minority regions of Tibet and Xinjiang.
The U.S.-China relationship remains dogged, however, by long-standing mutual mistrust. That
mistrust stems in part from the two countries’ very different political systems. Many in the United
States are uncomfortable with China’s authoritarian system of government and see continued
Communist Party rule in a post-Cold War world as an anachronism. Many Communist Party
elites in China are suspicious that the United States seeks to constrain China’s rise, and in the
longer-term, to foist multi-party democracy on China and push the Communist Party from power.
The two countries’ different economic models have led to mistrust, too. Some in the United States
believe that China has achieved its economic successes by playing by a different, and not always
fair, set of rules. Such critics point to China’s alleged strong reliance on exports for growth and
the PRC government’s policy of keeping China’s currency artificially weak, in part to make
Chinese exports more attractive to importing nations. Other points of contention include the PRC
government’s direct and indirect subsidies and other forms of support for its state-owned
corporations, and its inability or unwillingness to prevent violations of foreign intellectual
property by Chinese entities. For their part, PRC officials have sometimes criticized the United
States for its high levels of consumption, low savings rate, and long-term debt. Chinese officials
have also criticized the United States’ allegedly loose monetary policy.
Mistrust is particularly pronounced on security matters. The United States increasingly sees
China’s military modernization as aimed at constraining the U.S. military’s freedom of movement
in Asia and deterring any U.S. intervention in the case of a Chinese use of force against Taiwan.1
In mirror image, China sees the United States as intent on thwarting its unification with Taiwan
and constraining the activities of its own military throughout Asia. Although China stated in a
2009 U.S.-China Joint Statement that it “welcomes the United States as an Asia-Pacific nation
1 In a December 2010 speech, Admiral Michael Mullen, Chairman of the Joint Chiefs of Staff, declared that, “some of
the specific capabilities [that China is developing] are very clearly focused on and pointed at the United States of
America. And they are anti-access capabilities. We’re not going away [from Asia], so we’re going to be there.”
Admiral Michael Mullen, Speech at the Center for American Progress, Washington, DC, December 1, 2010,
http://www.jcs.mil/speech.aspx?id=1500.
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that contributes to peace, stability and prosperity in the region” (see “The 2009 U.S.-China Joint
Statement,” below), many in China chafe at the surveillance activities undertaken by the U.S.
military along China’s coast and at U.S. military exercises in waters near China, and regard U.S.
military alliances in Asia as aimed to a significant degree at China. With U.S. troops deployed in
Afghanistan, which shares a short border with China to the west, and with U.S. military and
intelligence agencies deeply engaged in Pakistan, also a neighbor to the west, some Chinese
commentators speak of their country being “encircled” by U.S. forces.2
The bilateral relationship was strained in 2010 by long-standing issues of disagreement between
the United States and China such as Taiwan and Tibet and China’s currency policy, as well as by
each side’s responses to unexpected new crises in Asia. China condemned the Obama
Administration’s January 2010 announcement of a long-planned sale of a package of arms to
Taiwan. It also strongly protested President Obama’s February 2010 meeting with the Dalai
Lama, although in hosting the meeting, the President was following in the footsteps of his
predecessors in the White House.
Among the unexpected crises that undermined U.S.-China relations was a series of North Korean
provocations, starting in March 2010 with North Korea’s apparent sinking of a South Korean
naval vessel. China incurred U.S. criticism for its efforts to shield North Korea from the most
serious diplomatic consequences for its actions, while the United States unsettled China when it
responded to the North Korean actions by scheduling military exercises in the Yellow Sea that
China charged were meant in part as a threat to China. In September 2010, the collision of a
Chinese fishing trawler and Japanese Coast Guard vessels near disputed islands in the East China
Sea set off a new crisis. The United States angered China by voicing its support for Japan in the
ensuing China-Japan spat, and by clarifying that that the U.S. military alliance with Japan covers
the disputed islands. Also contributing to bilateral tensions in 2010 were China’s reassertion of
expansive claims to territory in the South China Sea, and the United States’ subsequent July 2010
declaration of a “national interest” in freedom of navigation in the sea.
Obama Administration Policy
President Obama entered office with a goal of working with China to address a broad range of
global issues, most prominently the global financial crisis, climate change, and nuclear non-
proliferation, but also such issues as security in Afghanistan and Pakistan and the threat of
pandemic disease. In remarks in July 2009, he argued that partnership between the United States
and China was “a prerequisite for progress on many of the most pressing global challenges.”3
Some observers have raised concerns about where such issues as human rights and Taiwan fit into
cooperation with China on this global agenda. En route to Beijing a month after President
Obama’s inauguration, Secretary Clinton became a lightning rod for such concerns when she told
a media roundtable that the United States would continue to press China on such issues as Taiwan
2 A Chinese military commentator, Air Force Colonel Dai Xu, has referred to the United States carrying out a “C-shape
encirclement” of China. See Ge Qian, “Sino-U.S. Relations Tense as South China Sea Issues Escalate,” Southern
Metropolis News (Guangzhou), July 27, 2010, p. AA16. Colonel Dai published a book in China entitled “C-Shape
Encirclement” in 2010.
3 The White House Office of the Press Secretary, “Remarks by the President at the U.S./China Strategic and Economic
Dialogue,” July 27, 2009, http://www.whitehouse.gov/the-press-office/remarks-president-uschina-strategic-and-
economic-dialogue.
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and Tibet and human rights, “but our pressing on those issues can’t interfere with the global
economic crisis, the global climate change crisis, and the security crisis.”4 Some analysts argue
that this statement reflects the relatively low profile of human rights in the Obama
Administration’s relationship with China.
The Obama Administration has also sought to reassure China that it “welcomes a strong,
prosperous and successful China that plays a greater role in world affairs,”5 At the same time, the
United States has sought to shape the regional context for China’s rise by strengthening the
United States’ traditional alliances in Asia and stepping up its engagement throughout the region
in what Secretary Clinton calls “forward-deployed diplomacy.”6 Many analysts see the higher-
profile U.S. presence in Asia as part of a U.S. attempt to hedge against a strong China that might
be tempted to threaten its neighbors.
The United States has also sought to embed China in international institutions. It has worked with
China on non-proliferation issues in the United Nations Security Council, for example, and
welcomed a greater Chinese role in the International Monetary Fund (IMF) and the World Bank.
It has also confronted China on trade disputes through the mechanisms of the World Trade
Organization and on currency issues through the IMF. In an attempt to bring greater stability to
the bilateral relationship, the Obama Administration has embraced and added to a broad array of
official dialogues inherited from the George W. Bush Administration. It has also supported
myriad forms of bilateral government-to-government cooperation that rarely make headlines,
such as Department of Energy cooperation with China on clean energy projects, and launched a
public-private initiative to send Americans to study in China, known as the 100,000 Strong
Initiative.
The Obama Administration points to some successes in working with China to address pressing
global issues, including coordination of stimulus spending to address the global financial crisis
and cooperation in negotiating new sanctions against Iran and North Korea over their nuclear
programs. Overall, however, Administration officials suggest that China has not yet emerged as
the partner on global issues that the Obama Administration had hoped it would be. On climate
change, for example, U.S. and Chinese approaches to global climate change negotiations have
frequently been at odds, and the Obama Administration goal of a globally binding international
agreement to curb greenhouse gas emissions remains elusive. On North Korea, the United States
has been frustrated that China has not done more to condemn and help rein in the North Korean
regime’s provocative behavior. In what some analysts saw as a message to China, Secretary of
State Hillary Clinton warned in a September 2010 speech that when emerging powers, “do not
accept the responsibility that accrues with expanding influence, we will do all that we can to
encourage them to change course, while we will press ahead with other partners.”7 Two months
later, on a trip to Asia, President Obama endorsed a permanent seat for China’s long-time rival,
4 Secretary of State Hillary Rodham Clinton, Working Toward Change in Perceptions of U.S. Engagement Around the
World, Department of State, Roundtable with Traveling Press, February 20, 2010, http://www.state.gov/secretary/rm/
2009a/02/119430.htm.
5 The White House Office of the Press Secretary, “U.S.-China Joint Statement,” November 17, 2009,
http://www.whitehouse.gov/the-press-office/us-china-joint-statement.
6 Department of State, “[Secretary of State Hillary Rodham Clinton] Interview With Peter Hartcher of the Sydney
Morning Herald,” November 8, 2010, http://www.state.gov/secretary/rm/2010/11/150672.htm.
7 Secretary of State Hillary Rodham Clinton, Remarks on United States Foreign Policy, Department of State, Address
to Council on Foreign Relations, Washington, DC, September 8, 2010, http://www.state.gov/secretary/rm/2010/09/
146917.htm.
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India, on an expanded United Nations Security Council, and reaffirmed his support for such a seat
for another rival, Japan.
The United States sometimes refers to China as a member of a group of “major and emerging
global powers” that the United States hopes to persuade to shoulder greater global
responsibilities. In June 2009, Secretary Clinton listed seven such powers, starting with China and
followed, in order, by India, Russia, Brazil, Turkey, Indonesia, and South Africa.8 In September
2010, she referred to the same set of seven countries, plus Mexico, as “countries that are growing
rapidly and already exercising influence,” with China again topping the list, followed, in order, by
India, Turkey, Mexico, Brazil, Indonesia, South Africa, and Russia. In comments seen as directed
particularly at China, she said that such countries need to understand that, “being a 21st century
power means having to accept a share of the burden of solving common problems, and of abiding
by a set of the rules of the road, so to speak, on everything from intellectual property rights to
fundamental freedoms.9
The 2009 U.S.-China Joint Statement
The United States and China both consider three joint communiqués concluded in the Nixon,
Carter, and Reagan Administrations to provide the principles that underpin the relationship. All
three contain significant language related to one of the most sensitive issues in the U.S.-China
relationship, the handling of Taiwan, the self-governing island democracy of 23 million people
over which China claims sovereignty. The United States considers the Taiwan Relations Act of
1979 (P.L. 96-8) to be a fourth core document, although China does not. (See “Taiwan,” below.)
The two countries have also concluded two joint statements, one in 1997 during the Clinton
Administration, and one in 2009.
The 2009 Joint Statement, issued during President Obama’s November 2009 state visit to China,
laid down some significant new statements of principle. In the document, the U.S. side declared
that the United States “welcomes a strong, prosperous and successful China that plays a greater
role in world affairs,” while the Chinese side stated that China “welcomes the United States as an
Asia-Pacific nation that contributes to peace, stability and prosperity in the region.” This was the
first time China agreed to put in writing such a positive characterization of the U.S. presence in
Asia, although the wording of the Chinese-language version of the statement was more
conditional than the English. While the English text appeared to signal an acceptance that the
United States presence contributes to peace, stability, and prosperity in the region, the Chinese
text stated that China welcomes U.S. “efforts” for peace, stability, and prosperity in the region,
leaving open the question of how China sees the U.S. presence as contributing to peace, stability,
and prosperity currently.10
8 Secretary of State Hillary Rodham Clinton, “Foreign Policy Address at the Council on Foreign Relations,” Speech to
Council on Foreign Relations, Washington, DC, June 15, 2009, http://www.state.gov/secretary/rm/2009a/july/
126071.htm.
9 Secretary of State Hillary Rodham Clinton, Remarks on United States Foreign Policy, Department of State, Address
to Council on Foreign Relations, Washington, DC, September 8, 2010, http://www.state.gov/secretary/rm/2010/09/
146917.htm. In her September 2010 remarks, Secretary Clinton listed the countries in a new order: China, India,
Turkey, Mexico, Brazil, Indonesia, South Africa, and Russia.
10 The Chinese text of the line in question reads, “The Chinese side states that it welcomes efforts by the United States,
as an Asia-Pacific nation, for peace, stability, and prosperity in the region.” CRS translation of Xinhua News Agency,
Zhongmei lianhe shengming (China-U.S. Joint Statement), November 17, 2010, http://news.xinhuanet.com/world/2009-
(continued...)
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The 2009 Joint Statement also included the controversial statement that, “respecting each other’s
core interests is extremely important to ensure steady progress in U.S.-China relations.”11 “Core
interests” was left undefined. Critics have suggested that the language may have raised unrealistic
expectations on the Chinese side of greater U.S. deference to China on issues that China
considers part of its core interests, such as Taiwan, Tibet, and the maintenance of domestic
stability through suppression of dissent.12 The “core interests” language in the Joint Statement
may also have encouraged China to experiment with referring to the South China Sea as a “core
national interest” in some closed-door meetings with foreign officials in 2010. According to
Secretary of State Hillary Clinton, those statements contributed to the U.S. decision to declare a
“national interest” in freedom of navigation in the South China Sea at a meeting in Hanoi in July
2010.13
Finally, in the 2009 Joint Statement, the two sides stated that, “they are committed to building a
positive, cooperative and comprehensive U.S. China relationship for the 21st Century.”14 While
this statement may seem formulaic, officials in both governments are careful to include it in
almost every official statement related to the relationship. Its repetition is considered to provide
reassurance of each country’s commitment to the relationship. The “positive, cooperative, and
comprehensive” formulation marked an evolution from President George W. Bush’s description
of the relationship as “constructive, cooperative, and candid,”15 with “candid” upgraded to
“positive” and “comprehensive” added to reflect the broad range of issues on which the two
countries expected to work together. The Obama-Hu language was a departure from the language
agreed to by President Bill Clinton and his counterpart, Chinese President Jiang Zemin, in a 1997
Joint Statement, in which they pledged, “to build toward a constructive strategic partnership.”16
U.S.-China Dialogues
The United States and China have sought to dispel strategic mistrust and address issues of
common concern through frequent meetings of the two countries’ leaders and through dozens of
regularly scheduled dialogues. Dialogue on strategic issues remains limited, however, with U.S.
officials sometimes complaining that even at the height of the Cold War, the United States and the
Soviet Union had closer consultation on strategic issues than the United States and China do now.
On a visit to Beijing in January 2011, Secretary of Defense Robert M. Gates proposed a new
(...continued)
11/17/content_12475620_2.htm.
11 The White House Office of the Press Secretary, “U.S.-China Joint Statement,” November 17, 2009,
http://www.whitehouse.gov/the-press-office/us-china-joint-statement.
12 Thomas J. Christensen, “The Need to Pursue Mutual Interests in U.S.-PRC Relations,” a United States Institute of
Peace Special Report, forthcoming.
13 Greg Sheridan, “China actions meant as test, Hillary Clinton says,” The Australian, November 8, 2010.
14 The two presidents first agreed on this language during their first meeting in London in April 2009. It was later
enshrined in the Joint Statement. White House Office of the Press Secretary, Statement on Bilateral Meeting with
President Hu of China, April 1, 2009, http://www.whitehouse.gov/the-press-office/statement-bilateral-meeting-with-
president-hu-china.
15 Steven Lee Myers, “Bush Praises China but Continues Rebuke During Embassy Dedication in Beijing,” The New
York Times, August 7, 2008.
16 Joint US-China Statement, October 29, 1997, http://www.nti.org/db/china/engdocs/uschst97.htm.
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strategic security dialogue with China covering nuclear, space, missile defense, and cyber security
issues. Chinese officials said they would “study” the proposal.17
The U.S. and Chinese presidents have met for bilateral meetings on the sidelines of G-20 summits
and other leaders’ summits. President Obama made a state visit to China in November 2009 and
President Hu is scheduled to make a state visit to the United States in January 2011. In the first
two years of the Obama Administration, the two presidents will have held eight bilateral
meetings, or an average of one every three months.
Table 1. Bilateral Meetings Between President Barack Obama and Chinese
President Hu Jintao
Date Location Venue
April 1, 2009
London, United Kingdom
Sidelines of G-20 Summit
September 22, 2009
New York
Sidelines of United Nations
Summit on Climate Change
November 17, 2009 a
Beijing, China
President Obama’s state
visit to China
April 12, 2010
Washington, DC
Sidelines of Nuclear
Security Summit
June 26, 2010
Toronto, Canada
Sidelines of G-20 summit
November 11, 2010
Seoul, South Korea
Sidelines of G-20 summit
January 19, 2011
Washington, DC
President Hu’s state visit to
(scheduled)
the United States
a. The two presidents met twice on November 17, 2009, first in a bilateral meeting, and then in an expanded
bilateral meeting. The U.S. government counts these as two separate bilateral meetings.
The relationship’s highest-level and highest-profile regularly scheduled dialogue is the annual
Strategic and Economic Dialogue (S&ED), formed in 2009 by combining the Treasury
Department’s Strategic Economic Dialogue and the State Department’s Senior Dialogue. The
S&ED is headed on the U.S. side by the Secretary of State (strategic track) and the Secretary of
the Treasury (economic track), and on the Chinese side by the State Councilor for foreign affairs
(strategic track) and the Vice Premier for foreign trade (economic track). The S&ED includes
high-level representation from multiple other agencies, and serves as an umbrella for numerous
sub-dialogues. Supporters say the S&ED provides an invaluable opportunity for in-depth
discussion of a broad range of immediate and long-term issues at a very high level. Some
observers suggest, however, that the need to produce concrete outcomes to satisfy domestic
audiences makes it harder for negotiators to have the kind of far-ranging conversations needed to
dispel strategic mistrust.
The other dialogue of comparable seniority is the Joint Commission on Commerce and Trade
(JCCT), established in 1983 as a high-level forum for discussion of bilateral trade issues. Like the
S&ED, it is headed on the U.S. side by two cabinet-level officials, in the case of the JCCT, the
Secretary of Commerce and the United States Trade Representative. Their Chinese-side
counterpart is China’s Vice Premier for foreign trade. The JCCT currently includes ten working
17 Department of Defense, “Joint Press conference with Secretary Gates and General Liang from Beijing, China,”
transcript, January 10, 2011, http://www.defense.gov/transcripts/transcript.aspx?transcriptid=4750.
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groups covering trade and investment issues, business development and industrial cooperation,
and commercial law, with a side dialogue on export controls.18
U.S. Assistance Programs in China
Congress has mandated and provided foreign operations appropriations for democracy-related
programs in China since 2000. The majority of the funding for Department of State and U.S.
Agency for International Development (USAID)-administered activities in China supports rule of
law, civil society, and Tibetan development and environmental programs, and is provided to U.S.-
based non-governmental organizations. Between 2001 and 2010, the United States government
authorized nearly $275 million for foreign operations activities in China, of which $229 million
was devoted to rule of law and civil society programs and to Tibetan communities. In FY2010,
out of $47 million in foreign operations appropriations for China, $36.4 million was allocated for
democracy-related and Tibet programs, $7 million for HIV/AIDS programs, and the remainder
for Peace Corps activities in China and a criminal justice program. Some experts argue that
foreign-funded rule of law and civil society efforts in China have produced limited gains due to
PRC political constraints. Others contend that such programs have helped to build social
foundations for political change and have bolstered reform-minded officials in the PRC
government. The United States also sponsors assistance programs in China through other
agencies, such as those related to the safe handling of nuclear materials (Department of Energy)
and public health (Department of Health and Human Services).
For more information, see CRS Report RS22663, U.S.-Funded Assistance Programs in China, by
Thomas Lum.
China’s Foreign Policy
China has repeatedly committed itself to “the path of peaceful development.” An authoritative
December 2010 article by China’s top-ranking diplomat, Dai Bingguo, defined this as “the pursuit
of harmony and development at home as well as the pursuit of peace and cooperation in our
external relations.”19 China says its central focus remains its domestic economic development, for
which it needs a peaceful and stable external environment. In addition, Chinese officials say that
precepts laid down after the collapse of the Soviet Union by the architect of China’s policy of
reform and opening, Deng Xiaoping, continue to guide foreign relations. Deng decreed that China
should keep a low profile in international affairs, never become a hegemonic power, never be a
leader, always stand with the developing world, and think twice before criticizing or condemning
others or getting involved in others’ affairs. The approach is often summarized with the phrase,
“Hide one’s capabilities and bide one’s time, and endeavor to achieve something.”20
18 See JCCT factsheet at http://www.export.gov/china/policyadd/jcct.asp?dName=policyadd.
19 Dai Bingguo, “Persisting with Taking the Path of Peaceful Development,” Review Volume on “Chinese Communist
Party Central Committee’s Suggestions on Setting the Twelfth Five Year Plan for the National Economy and Social
Development,” December 6, 2010, as translated by the Open Source Center. For the Chinese-language text see
http://www.gov.cn/ldhd/2010-12/06/content_1760381.htm.
20 The literal translation of the Chinese phrase, “tao guang yang hui you suo zuo wei,” is “hide brightness and nourish
obscurity to have some accomplishments.” For a full discussion, see Xiao Feng, “How to understand Comrade
Xiaoping’s ‘Hide Brightness and Nourish Obscurity, Have Some Accomplishments’ Thought,” Beijing Daily, April 6,
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At the same time, however, China’s government has stated that it sees itself as having “core
interests” on which it will not compromise, although it has sent ambiguous signals about how it
interprets those “core interests.” U.S. officials were surprised, for example, when some Chinese
officials suggested in closed-door meetings in 2010 that China’s sovereignty claims in the South
China Sea had risen to the level of a “core interest” issue, along with such traditionally
understood “core interest” issues for China as China’s claim to sovereignty over Taiwan and its
control over Tibet. Warning that, “the violation and destruction of these interests will not be
tolerated,” in the December 2010 article,21 China’s top ranked diplomat presented China’s “core
interests,” as:
• “The leadership of the Chinese Communist Party, the socialist system, and the
path of socialism with Chinese characteristics”;
• “The sovereignty and security, territorial integrity, and national unity of China”;
and
• “The sustained development of the economy and society of China.”
In broad terms, analysts believe China sees the first of these “core interests,” the imperative to
uphold the leadership of the Communist Party, as justifying its suppression of domestic dissent.
China has long used the language of the second “core interest,” involving sovereignty, territorial
integrity, and national unity, in asserting its claim to Taiwan and its opposition to international
“interference” in affairs in the ethnic minority border regions of Tibet and Xinjiang. It also claims
“indisputable sovereignty” over disputed islands in the South China Sea and the East China Sea
and their surrounding waters, but it generally does not use the language of national unity in
reference to them. The third “core interest,” guaranteeing sustained economic development, is
seen by some analysts as driving China’s engagement with such energy- and mineral-rich nations
as Iran, Sudan, Burma, and Venezuela, although such engagement has at times undermined
relations with other parts of the world vital to China’s continued economic development,
including the United States and the European Union.
As China’s geopolitical clout has grown, China has faced increasing calls from the United States
and others to shoulder more responsibility for addressing global issues. That call has been met
with suspicion by many Chinese elites, who fear it is a Western-concocted ruse to constrain
China’s rise. The fear, as described by one Chinese commentator, is that the West seeks to “trap
China,” pull it into the West’s orbit, and force it to take on global challenges that are beyond its
abilities.22 Chinese officials assert that China has taken on greater responsibilities than in the past,
pointing to China’s role in responding to the global financial crisis, its active participation in
diplomacy to try to prevent the emergence of North Korea and Iran as nuclear states, its
participation in anti-piracy missions in the Gulf of Aden, and its increased participation in United
Nations peacekeeping operations. Many participants in the foreign policy debate in China counsel
(...continued)
2010.
21 Dai Bingguo, “Persisting with Taking the Path of Peaceful Development,” Review Volume on “Chinese Communist
Party Central Committee’s Suggestions on Setting the Twelfth Five Year Plan for the National Economy and Social
Development,” December 6, 2010, as translated by the Open Source Center. For the Chinese-language text see
http://www.gov.cn/ldhd/2010-12/06/content_1760381.htm.
22 Liu Baolai, “The opportunities facing China now are greater than the challenges” (“Dangqian zhongguo mianlin de
jiyu da yu tiaozhan”), China Economic Times (Zhongguo Jingji Shibao), December 15, 2009.
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caution in taking on further responsibilities, however, emphasizing that China remains a
developing country with pressing domestic challenges that must take precedence.
China’s “Soft Power” in the Developing World
As part of a drive to gain political and cultural influence and to secure energy and mineral
supplies and markets, in the past decade, China has reached out to the developing world,
including Africa, Central America, Latin America, Southeast Asia, and the Pacific, through high-
level official visits and exchanges; economic assistance, loans, and investments; participation in
regional organizations; and Chinese-language and educational programs. Competition with
Taiwan for diplomatic recognition also has spurred PRC engagement in some regions. According
to some analysts, China’s political and economic engagement, or global “soft power,” has risen,
in part due to a diplomatic void left by the United States under the George W. Bush
Administration as Washington focused on fighting terrorism. China’s relative economic strength
during the 2008-2009 global recession further enhanced its international stature. However, other
observers argue that China’s global strategic influence remains limited and its ideological and
cultural appeal lacks depth. Some countries, particularly in Asia, have begun to welcome the
United States as an economic and strategic counterweight to the PRC amid growing concerns
about Beijing’s intentions and increasing assertiveness.
According to many foreign policy experts, China’s foreign economic assistance and investments
have complicated U.S. and other Western efforts to curb human rights abuses and promote
democracy in places such as Angola and Sudan in Africa, Burma and Cambodia in Southeast
Asia, and Fiji in the Southwest Pacific. The United States government has taken preliminary steps
to discuss and coordinate development assistance and projects with China, in order to promote
“donor best practices” and convergence between Chinese foreign assistance practices and those of
major bilateral and multilateral aid donors. Under the Obama Administration, some dialogues
have taken place between staff and senior-level officials of the U.S. Agency for International
Development (USAID) and the PRC Ministry of Commerce’s Department of Aid to Foreign
Countries. At the second U.S.-China Strategic and Economic Dialogue (S&ED), held in May
2010, the two governments reportedly held a meeting on development issues and agreed to
engage in further dialogue in the future.23
For more information, see CRS Report RL34620, Comparing Global Influence: China’s and U.S.
Diplomacy, Foreign Aid, Trade, and Investment in the Developing World, coordinated by Thomas
Lum, and CRS Report R40940, China’s Assistance and Government-Sponsored Investment
Activities in Africa, Latin America, and Southeast Asia, by Thomas Lum.
Selected Policy Issues
Economic Issues
The U.S. and Chinese economies are the first and second largest in the world on both a nominal
dollar basis and a purchasing power parity basis, and are heavily interdependent. China is the
23 Jonathan Stromseth, “Searching for Global Cooperation in Sino-U.S. Relations: The Case of Foreign Aid,” In Asia,
The Asia Foundation, June 9, 2010.
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United States’ second largest trading partner, largest supplier of imports (imports from China
make up 19% of all U.S. imports), third largest export market (exports to China account for 6.6%
of all U.S. exports), and second largest export market for agricultural products. China is also the
largest foreign holder of U.S. Treasuries and, according to U.S. data, the destination for a
cumulative $45.7 billion in U.S. foreign direct investment (compared to China’s more modest
cumulative $1.2 billion foreign direct investment in the United States).24
Because of the size of the two economies, the bilateral economic relationship and the economic
decisions of both countries have a profound impact on the global economy. Shortly after the onset
of the global financial crisis, both countries announced large stimulus spending packages.
China’s, valued at $586 billion (or 13% of annual GDP), combined with a major expansion of
credit, helped its economy grow by 9.1% in 2009 and by a projected 10.5% in 2010.25 Those
growth rates, which far outstripped economic growth in every other major economy, are credited
with helping lead the world out of recession.
The Obama Administration has sought to cooperate with China in addressing the global financial
crisis and rebalancing the global economy, working primarily through the mechanism of the G-20
grouping of nations. It has also sought to work directly with China to resolve a host of issues
related to bilateral trade and investment and it has challenged China on such issues through the
World Trade Organization and the International Monetary Fund.
For more information, see CRS Report RL33536, China-U.S. Trade Issues, by Wayne M.
Morrison; CRS Report RL33604, Is China a Threat to the U.S. Economy?, by Craig K. Elwell,
Wayne M. Morrison, and Marc Labonte; and CRS Report RL33534, China’s Economic
Conditions, by Wayne M. Morrison.
Global Rebalancing
With the immediate financial crisis past, the focus of the G-20 leaders is now on the need for
fundamental restructuring of the global economy, with the greatest onus for action on the United
States and China. The United States runs the world’s largest trade deficit in goods and services.
China runs the world’s largest surplus. Many economists say that such huge imbalances in global
trade undermine the health of the global economy, and that the United States needs to save more
and consume less, while China needs to reduce its dependence on exports and investment in
infrastructure and consume more.
China has repeatedly pledged to boost domestic consumption. An October 2010 International
Monetary Fund report indicated some preliminary success, with Chinese domestic demand
growing close to 13% in 2009, leading to a significant reduction in China’s current account
surplus that year.26 China has been critical of the United States for its failure to address its part of
the rebalancing equation by significantly reducing its long-term debt.
24 Office of the United States Trade Representative, U.S.-China Trade Facts, http://www.ustr.gov/countries-
regions/china.
25 International Monetary Fund, World Economic Outlook: Recovery, Risk, and Rebalancing, October 2010, p. 2,
http://www.imf.org/external/pubs/ft/weo/2010/02/pdf/text.pdf.
26 International Monetary Fund, World Economic Outlook, Washington, DC, October 2010, p. 4, http://www.imf.org/
external/pubs/ft/weo/2010/02/pdf/text.pdf.
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China’s Currency Policy
The issue of China’s management of its currency, the renminbi or RMB, dominated meetings
between U.S. and Chinese officials for much of 2010. The Chinese government allowed the
renminbi to appreciate by 21% in relation to the dollar between 2005 and 2008, but China has
intervened in currency markets since then to keep the RMB exchange rate at a level that some
economists believe is still significantly undervalued against world currencies.27 An undervalued
RMB makes China’s exports to the world artificially cheap, and China’s imports from the rest of
the world, including the United States, artificially expensive for Chinese consumers. The Treasury
Department argues that significant appreciation of China’s currency could help stem outsourcing
of U.S. jobs and make U.S. goods and services more competitive globally. Chinese officials deny
that China’s currency practices are a significant cause of the U.S. global trade imbalance and
argue that in focusing on the currency issue, the United States is seeking to make China a
scapegoat for problems in the global economy attributable to multiple nations, including the
United States.
China’s central bank, the People’s Bank of China, announced plans in June 2010 to “enhance the
RMB exchange rate flexibility,”28 but at the G-20 summit in Seoul in November 2010, President
Obama stated that the Chinese currency was still “undervalued.” He urged China “in a gradual
fashion to transition to a market-based system” for determining the value of its currency, so that
“everybody benefits from trade rather than just some.”29 In the 111th Congress, the House
approved (348-79) a bill, H.R. 2378 (the Currency Reform for Fair Trade Act) that would have
allowed the Commerce Department to consider “fundamentally undervalued currencies” as illegal
export subsidies, but the measure was not taken up by the Senate. Analysts note that if the
Chinese currency does appreciate substantially, U.S. consumers will face higher prices for the
wide array of goods currently imported from China, and U.S. factories will likely face higher
costs for Chinese-made inputs.
For more information about China’s currency policy, see CRS Report RS21625, China’s
Currency: An Analysis of the Economic Issues, by Wayne M. Morrison and Marc Labonte, and
CRS Report RL32165, China’s Currency: Economic Issues and Options for U.S. Trade Policy, by
Wayne M. Morrison and Marc Labonte.
The Bilateral Trade Deficit
Trade between the United States and China has expanded dramatically in the years since China
acceded to the World Trade Organization in December 2001. In 2009, bilateral trade in goods
totaled $366 billion, with U.S. imports from China totaling $296 billion and U.S. exports to
China totaling $70 billion. The disparity in imports and exports produced a U.S. goods trade
deficit with China of $227 billion in 2009, according to U.S. data, accounting for 45.3% of the
overall U.S. goods trade deficit. In trade in services, the United States runs a surplus with China,
27 See, for example, C. Fred Bergsten, “We can fight fire with fire on the renminbi,” Financial Times, October 3, 2010.
28 People’s Bank of China, Further Reform the RMB Exchange Rate Regime and Enhance the RMB Exchange Rate
Flexibility , June 19, 2010, http://www.china-embassy.org/eng/zt/renmingbihuigai_eng/t710127.htm.
29 The White House Office of the Press Secretary, Press Conference by the President After G20 Meetings in Seoul,
Korea, November 12, 2010, http://www.whitehouse.gov/the-press-office/2010/11/12/press-conference-president-after-
g20-meetings-seoul-korea.
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with exports to China of $16 billion in 2008 (the latest year for which numbers are available) and
imports from China valued at $10 billion.30
Economists argue that the global trade balance is a more meaningful indicator of an economy’s
health than bilateral balances. Many American analysts nonetheless point to the United States’
bilateral goods trade imbalance with China to highlight China’s allegedly unfair trade practices
and undervalued currency and their impact on the U.S. economy. Chinese officials, who cite
different figures for the bilateral trade deficit than the United States, routinely seek to shift some
of the blame for the trade deficit to the United States by criticizing U.S. controls on exports of
advanced technology. They also argue that the sharp increase in exports to the United States
reflects the shifting of production from other countries to China, and that many “made in China”
products contain components from other countries.
For more information, see CRS Report RS22640, What’s the Difference?—Comparing U.S. and
Chinese Trade Data, by Michael F. Martin, and CRS Report R40167, Globalized Supply Chains
and U.S. Policy, by Dick K. Nanto.
China’s Holdings of U.S. Treasuries
The U.S. federal budget deficit has increased rapidly since 2008, financed by sales of Treasury
securities. China has been the largest foreign holder of U.S. Treasury securities, and thus the
largest foreign financer of the U.S. deficit, since September 2008, with its holdings standing at
$868.4 billion in August 2010. The combination of China’s reliance on exports to the United
States and its purchase of U.S. debt has given China a major stake in the health of the U.S.
economy. China’s holdings of U.S. Treasuries have also shifted the balance of financial power
between Washington and Beijing, emboldening China to speak out with criticisms of the way the
U.S. economy is managed, and some analysts believe, to expect greater deference from the
United States on issues that China considers core interests.
For more information, see CRS Report RL34314, China’s Holdings of U.S. Securities:
Implications for the U.S. Economy, by Wayne M. Morrison and Marc Labonte.
China’s Compliance with World Trade Organization Commitments
Since 2006, the U.S. government has repeatedly raised concerns about alleged backsliding in
China’s implementation of commitments it made as part of its 2001 accession to the World Trade
Organization, most prominently the problem of “excessive, trade-distorting government
intervention intended to promote or protect China’s domestic industries and state-owned
enterprises.”31 China’s inadequate protection of intellectual property rights has also been a major
concern. The Obama Administration has filed four cases against China with the World Trade
Organization, including three in 2010. Those four cases relate to China’s import substitution
subsidies in the wind energy sector, its anti-dumping and countervailing duties on grain-oriented
electrical steel from the United States, its restrictions on foreign suppliers of electronic payment
30 Office of the United States Trade Representative, U.S.-China Trade Facts, http://www.ustr.gov/countries-
regions/china.
31 United States Trade Representative, 2010 Report to Congress on China’s WTO Compliance, December 2010, p. 2,
http://www.ustr.gov/webfm_send/2460.
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services, and its restraints on exports of raw materials used in the steel, aluminum, and chemical
sectors. The Obama Administration reports, however, that it made progress on some long-
standing trade issues with China at the December 2010 meeting of the U.S.-China Joint
Commission on Commerce and Trade in Washington, DC.32
For more information about China and the WTO, see CRS Report RS20139, China and the World
Trade Organization, by Wayne M. Morrison.
China’s “Indigenous Innovation” Policies
The U.S. business community has expressed strong concern about Chinese industrial policies
apparently intended to limit market access for non-Chinese goods and services and promote
domestic Chinese industries. They are considered part of China’s drive to support “indigenous
innovation.” The policies include government procurement catalogues that favor domestic
industries, patent rules that appear to allow Chinese companies to obtain patents for products that
they did not invent, and a new anti-monopoly law that the PRC government has allegedly used to
try to force technology transfers from foreign firms to Chinese firms.33 At the December 2010
meeting of the U.S.-China Joint Commission on Commerce and Trade, the Obama Administration
reports that the Chinese side made some concessions, agreeing, among other things, not to base
government procurement decisions on where intellectual property is owned or developed, to
accelerate China’s accession to the WTO’s Government Procurement Agreement, and to revise a
major equipment catalogue and ensure that it does not discriminate against foreign suppliers.
China’s Enforcement of Intellectual Property Rights (IPR)
The United States Trade Representative continues to place China on its Priority Watch List of
countries that are the worst violators of intellectual property rights, a list that currently comprises
11 countries.34 USTR’s annual Special 301 report on IPR, issued in April 2010, stated that China’s
IPR enforcement regime “remains largely ineffective and non-deterrent” and reported that of all
products seized at U.S. borders for infringement of intellectual property rights in 2009, 79% were
from China.35 At the December 2010 meeting of the U.S.-China Joint Commission on Commerce
and Trade, China pledged to step up its efforts to ensure the use of legal software by government
agencies and state-owned enterprises, to crack down on piracy of online academic journals, and to
clarify the liabilities of market managers who rent space to counterfeiters.
32 For details of China’s pledges at the December 2010 JCCT meeting, see Export.gov, “The U.S.-China Joint
Commission on Commerce and Trade (JCCT) Outcomes on U.S. Requests,” press release, December 15, 2010,
http://www.export.gov/china/policyadd/JCCT_outcomes.asp, and United States Trade Representative, 2010 Report to
Congress on China’s WTO Compliance, December 2010, pp. 3-4, http://www.ustr.gov/webfm_send/2460.
33 For details of China’s “indigenous innovation” policies and their alleged impact on U.S. business interests, see James
McGregor, China’s Drive for ‘Indigenous Innovation’—A Web of Industrial Policies, US Chamber of Commerce, July
2010, http://www.uschamber.com/sites/default/files/reports/100728chinareport_0.pdf.
34 The other countries on USTR’s “Priority Watch List” are Algeria, Argentina, Canada, Chile, India, Indonesia,
Pakistan, Russia, Thailand, and Venezuela.
35 United States Trade Representative, “2010 Special 301 Report,” April 30, 2010.
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Safety of Chinese Products
In recent years, the U.S. Consumer Product Safety Commission (CPSC) and the Food and Drug
Administration (FDA) have been flooded with complaints about dangerous and defective
consumer products, pharmaceuticals, medical devices, and food items manufactured in China and
the Hong Kong Special Administrative Region of China and exported to the United States.
Priority areas for the CPSC include the persistent problem of lead in children’s products from
China and dangerous defects in Chinese-made drywall, toys, cigarette lighters, fireworks,
electrical products, and all-terrain vehicles.36 Among the FDA’s priority areas is the problem of
counterfeit and tainted pharmaceuticals originating in China. In 2007 and 2008, contaminated
Heparin from China was linked to 149 deaths in the United States.37
For more information on this issue, see CRS Report RS22713, Health and Safety Concerns Over
U.S. Imports of Chinese Products: An Overview, by Wayne M. Morrison.
Climate Change and Clean Energy Cooperation
China relies heavily on coal to power its fast-growing economy and has been the world’s largest
emitter of the most common greenhouse gas, carbon dioxide, since 2006,38 although on a per
capita basis, China’s carbon dioxide emissions are about one third those of the United States.39 In
2008, China and the United States, the world’s second largest emitter, together produced about
41% of the world’s carbon dioxide emissions,40 making both countries essential players in efforts
to address climate change.
The Obama Administration hoped to make cooperation with China on the issue a pillar of a new
relationship focused on global issues, but in practice, the two countries’ different approaches to
international climate change negotiations have produced frequent friction. Disagreements have
centered on the relative responsibilities of developed and major developing nations for addressing
climate change. China, along with many other developing countries, has long argued that
developed nations bear the lion’s share of the historical responsibility for climate change and
continue to have far higher levels of emissions per capita, so they alone should be subject to
legally binding commitments to reduce emissions, while developing nations’ reductions should be
voluntary.41 Chinese officials have described attempts to force developing countries to accept
36 Inez Tenenbaum, Chairman of US Consumer Product Safety Commission, “Closing Statement,” Remarks to the
U.S.-China Consumer Product Safety Summit, Wuxi, China, October 26, 2009, http://www.cpsc.gov/PR/
tenenbaum102609.pdf.
37 Allan Coukell, Director, Pew Prescription Project, The Pew Charitable Trusts, “Protecting Consumers from
Adulterated Drugs,” written comments submitted to an FDA meeting, May 1, 2009, http://www.fda.gov/downloads/
NewsEvents/MeetingsConferencesWorkshops/UCM163646.pdf.
38 PBL Netherlands Environmental Assessment Agency, “China CO2 emissions in perspective,” press release, June 22,
2007, http://www.pbl.nl/en/news/pressreleases/2007/20070622ChineseCO2emissionsinperspective.html.
39 J.G.J. Olivier and J.A.H.W. Peters, No Growth in Global CO2 Emissions in 2009, Netherlands Environmental
Assessment Agency, Bilthoven, The Netherlands, June 2010, p. 5, http://www.rivm.nl/bibliotheek/rapporten/
500212001.pdf.
40 International Energy Agency, CO2 Emissions from Fuel Combustion Highlights: 2010 Edition, Paris, France, 2010,
pp. 8-9, http://www.iea.org/co2highlights/co2highlights.pdf.
41 Scientists believe the United States is responsible for 29% of energy-related carbon dioxide emissions since 1850,
while China is responsible for 8%. Joanna Lewis, “The State of U.S.-China Relations on Climate Change: Examining
the Bilateral and Multilateral Relationship,” Woodrow Wilson International Center for Scholars China Environment
(continued...)
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legally binding emissions targets as an attempt to restrict those countries’ rights to develop.42 The
U.S. Congress, however, has long indicated that it will not support legally binding commitments
to reduce U.S. emissions without binding commitments from other major emitters, starting with
the world’s current leading emitter, China.43 The Obama Administration has adopted the same
position.
Negotiators representing the United States and China clashed at the Copenhagen Climate Change
Conference in Denmark in December 2009, but eleventh hour negotiations between President
Obama, China’s Premier Wen Jiabao, and leaders from Brazil, India, and South Africa, helped
produce a political accord that rescued the conference from complete failure. In the accord, which
was not legally binding, China and other developing nations agreed to a form of “symmetry” in
obligations for developed and developing nations, a major priority for the United States, by
agreeing that both groups of nations should record climate change mitigation commitments in
appendices to the accord on an equally voluntary basis. The United States pledged to reduce its
emissions “in the range of” 17% below 2005 levels by 2020. China declined to pledge an absolute
reduction target, but rather pledged to reduce its carbon intensity (the amount of carbon dioxide
emitted per unit of GDP) by 40% to 45% below 2005 levels by 2020. In the final negotiation with
President Obama, China also agreed to the principle that mitigation actions taken by developing
nations should be subject to a form of verification, known as “international consultation and
analysis” or ICA.44
At the United Nations Climate Change Conference in Cancun, Mexico, in December 2010, the
tone of interactions between U.S. and Chinese negotiators was reportedly more positive than in
Copenhagen. 45 After a year of wrangling with U.S. negotiators over what “international
consultation and analysis” of developing country actions should mean, China signed on to
additional details of a transparency regime for developing countries that included many elements
that the United States had sought. For its part, China left Cancun pleased that the United States
and other developed countries agreed to a new Green Climate Fund to help developing countries,
to a technology mechanism to support deployment of clean technologies around the world, and to
strengthened requirements for reporting and review of U.S. actions.46
(...continued)
Series, no. 11 (2010/2011), p. 8.
42 China’s chief climate change negotiator Xie Zhenhua charged in a January 2010 speech that, “Developed countries
are using climate change issues to restrict the development of developing countries and maintain the North-South gap
between the rich and the poor, with countries like China, Brazil, and India particularly targeted; they are very worried
about China’s pace of development.” “Xie Zhenhua’s Speech at Peking University, Guanghua College of Management,
January, 2010,” World Resources Institute China FAQs, http://www.chinafaqs.org/library/xie-zhenhuas-speech-peking-
university-guanghua-college-management-january-2010 (unofficial English translation). Original Chinese text
available at http://finance.sina.com.cn/hy/20100109/11137218805.shtml.
43 As early as 1997, the Byrd-Hagel Resolution (S.Res. 98) held that the United States should not enter into any
international agreement requiring binding commitments to limit greenhouse gas emissions unless the agreement also
subjects developing countries to specific binding commitments.
44 For a detailed account of U.S. and Chinese positions at Copenhagen, see Joanna Lewis, “The State of U.S.-China
Relations on Climate Change: Examining the Bilateral and Multilateral Relationship,” Woodrow Wilson International
Center for Scholars China Environment Series, no. 11 (2010/2011).
45 Jennifer Morgan and Deborah Seligsohn, “What Cancun Means for China and the U.S.,” World Resources Institute
China FAQs, December 15, 2010, http://www.chinafaqs.org/blog-posts/what-cancun-means-china-and-us.
46 Ibid.
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On clean energy cooperation, the United States and China have signed multiple agreements on
energy efficiency and clean energy technology development, and established numerous related
dialogues and forums. During President Obama’s November 2009 state visit to China, the United
States and China announced a broad package of cooperative clean energy projects, including
establishment of U.S.-China Clean Energy Research Centers and joint initiatives to develop
energy efficient buildings, electric vehicle standards, and clean coal and large-scale carbon
capture and storage technologies.47 China has been eager to work with the United States in
developing and deploying clean energy technologies as a matter of national competitiveness. As
China’s chief climate change negotiator explained in a January 2010 speech, “countries with low-
carbon technologies or low-carbon industries will have a development advantage and more
development space.” He said some saw global competition in clean energy development “as
significant as the space race in the Cold War.”48
China leads the world in its investment in low-carbon industries and has become a leader in the
production of some green energy technologies, such as photovoltaic solar panels. Experts say,
however, that the PRC continues to lag behind the United States in research and development, as
well as in deployment of key technologies such as wind power and solar power. China’s embrace
of clean energy has sometimes stirred controversy. The United States has challenged China’s
support for its domestic wind turbine industry through the World Trade Organization, and China’s
ambitious plans to tap its hydropower resources have embroiled it in disputes with down-river
neighbors in Southeast and South Asia.
For more information, see CRS Report RL32721, Greenhouse Gas Emissions: Perspectives on
the Top 20 Emitters and Developed Versus Developing Nations, by Larry Parker and John
Blodgett, and CRS Report R41287, China and the United States—A Comparison of Green Energy
Programs and Policies, by Richard J. Campbell.
Human Rights Issues
China’s human rights conditions are a principal U.S. interest. Some analysts contend that the U.S.
policy of engagement with China has failed to produce meaningful political reform, and that
without fundamental progress in this area, the bilateral relationship will remain unstable. Others
argue that U.S. engagement has helped to accelerate economic and social change and build social
and legal foundations for democracy and the advancement of human rights in the PRC.
Secretary of State Hillary Clinton described the Administration’s human rights policy as one of
“principled pragmatism.” This policy is based upon the premise that tough but quiet diplomacy is
both less disruptive to the overall relationship and more effective in producing change than public
censure.49 Many human rights activists have accused the Obama Administration of reducing the
47 U.S. Department of Energy, “U.S.-China Clean Energy Announcements,” press release, November 17, 2010,
http://www.energy.gov/news2009/8292.htm.
48 “Xie Zhenhua’s Speech at Peking University, Guanghua College of Management, January, 2010,” World Resources
Institute China FAQs, http://www.chinafaqs.org/library/xie-zhenhuas-speech-peking-university-guanghua-college-
management-january-2010 (unofficial English translation.) Original Chinese text available at
http://finance.sina.com.cn/hy/20100109/11137218805.shtml.
49 Elise Labott, “Clinton Defends Stance on Human Rights,” CNN.com, March 11, 2009; Charley Keyes, “U.S. is
‘Pragmatic’ with China, Russia,” CNN.com, December 15, 2009.
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prominence of human rights in U.S. policy toward China. Some policy observers have argued that
this approach has resulted in a more aggressive rather than cooperative Chinese leadership.50
Despite reducing the prominence of human rights as a condition for moving forward in other
areas of the bilateral relationship or in the relationship overall, a trend that started under President
George W. Bush, the Obama Administration has continued to press China on human rights issues,
both privately and openly. U.S. concerns include prominent political prisoners, jailed U.S.
citizens, Internet censorship, and developments in Tibet and Xinjiang. The U.S. government also
has continued to support the development of the rule of law and civil society in the PRC.
Members of the 111th Congress called upon the PRC leadership to release political prisoners,
cease persecution of Falun Gong and “house churches,” and respect the rights of ethnic
minorities; introduced various resolutions supporting human rights in China; and passed
legislation upholding Tibetan rights, commemorating the 1989 democracy movement, and
supporting human rights activists.
In May 2010, the United States and China held the fourteenth round of the bilateral human rights
dialogue, which had resumed in 2008 after a six-hear hiatus. No breakthroughs were reported in
the discussions headed by Assistant Secretary of State Michael Posner and PRC Ministry of
Foreign Affairs Department of International Organizations Director General Chen Xu. According
to some critics, the separate dialogue runs the risk of further removing human rights from the core
areas of the U.S.-China relationship. However, some Administration officials suggested that,
given the deep disagreements on human rights and other contentious issues, the holding of the
dialogue and the agreement to continue them, possibly on a regular and more frequent basis,
represented a positive step. Topics included freedom of religion and expression, labor rights, the
rule of law, political dissidents, and conditions in Tibet and Xinjiang. The two sides discussed the
resumption of the legal experts dialogue. The Chinese delegation also visited the U.S. Supreme
Court and were briefed on ways in which human rights issues are handled in the United States.51
Despite the lack of fundamental change, in the past decade, many PRC citizens have experienced
marginal improvements in human rights protections while human rights activism in China has
increased. The Internet has provided Chinese citizens with unprecedented amounts of information
and opportunities to express opinions publicly and even criticize government officials. However,
due to censorship and other restrictions and to the non-political nature of most Web activity in
China, the Internet has proven to be less of a political factor than many observers had expected or
hoped.
U.S. congressional committees and commissions have held hearings on the topics of global
Internet freedom and the roles of U.S. Internet and technology companies in China’s censorship
regime.52 While visiting Shanghai during his state visit to China in November 2009, President
Barack Obama expressed support of unrestricted Internet access and disapproval of censorship.
50 “It’s Time For The Obama Administration To Burst Beijing’s Bubble,” Washington Post, Thursday, February 4,
2010.
51 Foster Klug, “No Breakthroughs in U.S., China Human Rights Talks,” Associated Press, May 14, 2010; State
Department Special Briefing with Michael Posner, Assistant Secretary for Democracy, Human Rights and Labor, May
14, 2010.
52 For the most recent hearing on the topic, see House Committee on Foreign Affairs, The Google Predicament:
Transforming U.S. Cyberspace Policy to Advance Democracy, Security, and Trade, March 10, 2010. For further
information, see CRS Report R41120, U.S. Initiatives to Promote Global Internet Freedom: Issues, Policy, and
Technology, coordinated by Patricia Moloney Figliola.
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On January 21, 2010, in a policy speech on Internet freedom, Secretary of State Hillary Clinton
urged U.S. Internet companies to oppose censorship in their overseas operations and announced
that the Global Internet Freedom Taskforce (GIFT) would be reinvigorated.
In 2010, the PRC government amended
An American Detained in China
legislation to reduce arbitrary use of the “state
Xue Feng, a China-born, naturalized U.S. citizen, was
secrets” law and to make it easier for citizens
arrested in Beijing in 2007 on charges related to his
to obtain compensation due to state negligence
acquisition of a Chinese database on China’s oil industry
while working for an American firm. In July 2010, after
or abuse of power. However, according to
having been held incommunicado for a period and
most observers, the state secrets law still can
allegedly tortured, Xue was sentenced to eight years in
be used broadly against political dissidents
prison for providing state secrets to foreigners. Xue
and others. The changes also imposed stricter
claimed that he had believed the database to be
requirements on Internet service providers and
commercially available. U.S. consular officials have had
regular contact with Xue, although U.S. officials were
telecommunications companies to monitor
denied access to Xue’s November 2010 appeal hearing,
discourse and to report the transfer of state
in violation of the 1980 U.S.-China Consular
secrets to authorities.54
Convention.53 U.S. Ambassador to China Jon Huntsman
and President Barack Obama have raised the issue of
In response to a surge in labor disputes and
Xue Feng with China’s leaders.
unrest, including strikes at several large,
foreign-owned factories, in 2010, the PRC government approved substantial wage raises in many
enterprises and cities. Some Chinese labor experts and official sources expressed support for
higher wages, a greater advocacy role for China’s official union, the All China Federation of
Trade Unions (ACFTU), and the process of collective bargaining.55 However, Chinese workers
are still not allowed to form independent unions, and the government remains vigilant against the
development of a national labor movement. In May 2010, the U.S. Department of Labor and the
ACFTU held meetings on the sidelines of the U.S.-China Strategic and Economic Dialogue.
These discussions were billed as the start of an annual discussion on labor issues, including
pensions, workplace safety, and labor dispute resolution.
The PRC leadership has instituted few real checks on its power and remains extremely sensitive
to social instability, autonomous political activity, and potential challenges to its authority. In the
past year, the government has cracked down upon human rights lawyers, social organizations, and
Internet use. Major ongoing problems include the following: excessive use of violence by security
forces and their proxies; unlawful detention; torture; arbitrary use of state security laws against
political dissidents; coercive family planning policies; state control of information; and
harassment and persecution of people involved in unsanctioned religious activities, including
worship in unregistered Protestant “house churches” and Catholic churches that express loyalty to
the Pope. Many Tibetans, ethnic Uighur (Uygur) Muslims, and Falun Gong adherents have been
singled out for especially harsh treatment. The Congressional-Executive Commission on China
has documented 1,452 cases of political and religious prisoners known or believed to be under
detention.56
53 Embassy of the United States, Beijing, “DCM’s Statement: Appeal Trial of Dr. Feng Xue,” press release, October 30,
2010, http://beijing.usembassy-china.org.cn/113010dcm.html.
54 “State Secrets Law Amended,” Global Times, April 30, 2010; Gillian Wong, “China Set to Tighten State-Secrets
Law Forcing Internet Firms to Inform on Users,” Washington Post, April 28, 2010.
55 Peng Pu, “Drive to Give Trade Unions Stronger Role,” Global Times, August 30, 2010.
56 Congressional-Executive Commission on China Political Prisoner Database, List of Political Prisoners Detained or
Imprisoned as of October 10, 2010, http://www.cecc.gov/pages/victims/20101010_PPD_AR10.pdf.
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Prominent Political Dissidents
Chen Guangcheng, a lawyer who is blind, was jailed in 2006 after he attempted to seek redress for villagers subject to
illegal, excessive, and harsh treatment related to China’s one child policy. He was released from prison in September
2010 but remains under house arrest.
Zheng Enchong, a lawyer and housing rights activist, has faced harassment and been confined to his home by local
security personnel since his release from prison in 2006.
Gao Zhisheng, a rights lawyer who defended Falun Gong practitioners and others, was detained and allegedly
tortured in 2007. PRC authorities apprehended Gao in February 2009 and held him at various unknown locations for
over a year. After being allowed to make some contact with family members and the press in April 2010, Gao
disappeared again.
Hu Jia, who advocated on behalf of HIV/AIDS patients, other human rights activists, and environmental causes, was
sentenced to three years and six months in prison in 2008 for “inciting subversion of state power.”
Huang Qi, a human rights advocate, was sentenced to three years in prison in November 2009. A PRC court
convicted Huang for “possessing state secrets” after posting online appeals and complaints from families whose
children had been killed in school buildings during the Sichuan earthquake of May 2008.
Liu Xiaobo, a critic of the PRC government who was active in the 1989 democracy movement and helped to draft
Charter ’08, a document calling for democracy and disseminated online, was sentenced to 11 years in prison in
December 2009. The Beijing court convicted Liu of “inciting subversion of state power.” In October 2010, Liu won
the Nobel Peace Prize.
Nobel Laureate Liu Xiaobo
In October 2010, the Nobel Committee awarded Liu Xiaobo, formerly a professor at Beijing
Normal University and a long time political dissident, activist, and writer, the Nobel Peace Prize
for his “long and non-violent struggle for fundamental human rights.” He had spent three years in
prison for his role in the 1989 democracy movement and three years in a labor camp (1996-1999)
for openly questioning Communist Party rule. From 2003 to 2007, Liu served as President of the
Independent Chinese PEN Center, which advocates freedom of speech and press, and experienced
frequent harassment by local authorities. In December 2008, Liu helped draft “Charter ’08”
commemorating the 60th anniversary of the United Nations’ adoption of the Universal Declaration
of Human Rights.57 The document, signed by 300 Chinese citizens and posted online, called for
human rights and fundamental changes in China’s political system. It eventually garnered roughly
10,000 additional signatures online. The PRC government shut down the Charter’s website,
reportedly harassed, interrogated, or denied career benefits to roughly 100 original signatories and
arrested Liu. In December 2009, a Beijing court sentenced Liu to 11 years in prison on charges of
"inciting subversion of state power.”
Following the announcement of the Nobel Peace Prize, the official China Daily disparaged Liu
for his “respect and praise for Western political, economic, and cultural systems.” It also
criticized the dissident for founding the Chinese PEN Center and for working as a paid staff
member of Democratic China magazine, noting its U.S. ties.58 The PRC government harassed,
detained, interrogated, placed under house arrest, denied visas to, and confiscated the computer
equipment of dozens of fellow Chinese dissidents, political activists, and family members. It
barred members or representatives of Liu’s family from traveling to Oslo to accept the prize, and
57 “Charter ‘08” was inspired by “Charter 77,” the Czechoslovakian democratic movement.
58 “Who is Liu Xiaobo?” China Daily, October 28, 2010. Both the Chinese PEN Center and Democratic China had
received funding from the National Endowment for Democracy, which receives U.S. government support.
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blocked western news media in the days leading up to the awards ceremony.59 The PRC
government also cancelled some events or meetings involving Norwegian cultural performances
and officials, and reportedly lobbied foreign governments, warning them not to send diplomats to
the Nobel ceremony. The 111th Congress approved two resolutions, H.Con.Res. 151 and H.Res.
1717, in support of Liu (see Appendix B).
Tibet
Along with Taiwan and Xinjiang, Tibet is a particularly sensitive issue in U.S.-China relations.
Although the Chinese Communist Party has controlled Tibet since 1951, it continues to face
challenges to its authority there. The religious policies of the atheist Communist Party have
engendered resentments among Tibetans, many of whom still venerate the leader of Tibetan
Buddhism, the Dalai Lama, who fled into exile in India in 1959. The domination of the local
economy by migrants from other parts of China has also been a source of grievance for Tibetans,
as have China’s alleged human rights abuses. The State Department’s 2009 Human Rights Report
for Tibet charged that China had carried out “extrajudicial killings, torture, arbitrary arrests,
extrajudicial detention, and house arrest” in the region.60 China’s leaders, however, often blame
the international community, and particularly the United States, for Tibet’s restiveness, arguing
that international support for the Dalai Lama has encouraged forces intent on “splitting” Tibet
from China.
The U.S. government recognizes the Tibet Autonomous Region (TAR) and Tibetan areas in four
Chinese provinces as part of China and has always done so. Congress, however, has at times
referred to Tibet as “an occupied country” and to the Dalai Lama and his government-in-exile as
“Tibet’s true representatives.61 Reflecting continuing strong congressional support for the Dalai
Lama, Congress in 2006 passed legislation (P.L. 109-287) to award him the Congressional Gold
Medal, the nation’s highest civilian honor, “in recognition of his many enduring and outstanding
contributions to peace, non-violence, human rights, and religious understanding.”
The Tibetan Policy Act of 2002 (P.L. 107-228) guides Executive Branch policy related to Tibet. It
directs the Executive Branch to encourage the PRC to enter into dialogue with the Dalai Lama or
his representatives “leading to a negotiated agreement on Tibet,” and to work to end PRC
government interference in the religious affairs of the Tibetan people. It requires the State
Department to maintain a Special Coordinator for Tibetan Issues to promote dialogue between the
PRC and the Dalai Lama or his representatives. (The incumbent coordinator is Under Secretary of
State for Democracy and Global Affairs Maria Otero.) The act also states that it is the policy of
the United States to support development projects in Tibet; directs the Secretary of State to “make
best efforts” to establish a U.S. office in the Tibetan capital, Lhasa; and requires the President and
59 “Keith B. Richburg, “On Eve of Nobel Ceremony, China Cracks Down and Lashes Out,” Washington Post,
December 9, 2010.
60 U.S. Department of State, 2009 Human Rights Report: China (includes Tibet, Hong Kong, and Macau), March 11,
2010, http://www.state.gov/g/drl/rls/hrrpt/2009/eap/135989.htm#tibet.
61 The Foreign Relations Authorization Act for FY1992-1993 (P.L. 102-138) included a Declaration of Congress
entitled, “China’s Illegal Control of Tibet.” It stated that, “Tibet, including those areas incorporated into the Chinese
provinces of Sichuan, Yunnan, Gansu, and Quinghai [sic], is an occupied country under the established principles of
international law,” and that, “Tibet’s true representatives are the Dalai Lama and the Tibetan Government in exile.”
Similar language can be found in such legislation as P.L. 103-236 and S.Res. 271 (1992).
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the Secretary of State to use meetings with the PRC government to request the release of Tibetan
political prisoners.
Over strenuous objections from the PRC government, President Obama met with the Dalai Lama
in the White House Map Room on February 18, 2010.62 The Obama Administration had
postponed meeting with the Dalai Lama in the fall of 2009 in order to ease the way for a
resumption of dialogue between the PRC government and representatives of the Dalai Lama. That
dialogue, the ninth round of meetings between the two sides since 2002, took place in January
2010, with the Dalai Lama’s representatives pledging respect for the authority of the Chinese
central government, but continuing to push for genuine autonomy for the Tibetan people within
China. Both sides indicated that the meetings produced no breakthroughs.
Also in January 2010, the PRC government convened a National Conference on Work in Tibet,
the first such meeting since 2001 and the fifth since 1980. According to some analysts, the
meeting appeared to acknowledge alienation caused by some government policies. Among its
outcomes was a revised development plan for the region that included promises to extend health
insurance, improve access to such public services as electricity and running water, improve the
quality of rural schools, and step up efforts to protect Tibet’s cultural heritage and the delicate
ecology of the region. However, the conference did not signal any intention on the part of the
PRC leadership to change tack on issues related to autonomy or religious freedom.63
Xinjiang
Xinjiang, known officially as the Xinjiang Uighur Autonomous Region or XUAR, is home to 8.5
million Uighur Muslims, a Turkic ethnic group.64 Once the predominant group in Xinjiang, they
now constitute about 45% of the region’s population as many Han (Chinese), the majority ethnic
group in China, have migrated there, particularly to the capital, Urumqi. Uighurs and human
rights groups have complained of Chinese policies such as restrictions on access to mosques, the
training and role of imams, the celebration of Ramadan, contacts with foreigners, and
participation in the hajj. Uighur children (under 18) are forbidden from entering mosques and
government workers are not allowed to practice Islam. More recent Uighur grievances have
included a perceived loss of ethnic and cultural identity, a lack of consultation by the government,
and economic discrimination.
The Chinese government fears not only Uighur demands for greater religious and cultural
freedom but also Uighurs’ links to Central Asian countries and foreign Islamic organizations. The
Chinese government claims that the East Turkestan Islamic Movement (ETIM), a Uighur
organization that advocates the creation of an independent Uighur Islamic state, has been
responsible for small-scale terrorist attacks in China and has ties to Al Qaeda. ETIM is on the
United States’ and United Nations’ lists of terrorist organizations.
Due to perceived national security-related concerns, the Chinese government has imposed stern
ethnic and religious policies on Uighurs in Xinjiang, often conflating Uighur activism with
separatism. Following July 2009 demonstrations and inter-ethnic strife in Urumqi that left nearly
62 “Beijing Demands U-Turn on Obama’s Dalai Lama Meet,” Agence France Presse, February 12, 2010.
63 For a compilation of English-language reports on the National Conference on Work in Tibet by China’s official news
agency, Xinhua, see http://news.xinhuanet.com/english/2010-01/23/content_12860083.htm.
64 Estimates of China’s Muslim population range from 20 million to 30 million people.
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200 dead, about two-thirds of them Han, the Chinese government further restricted speech,
assembly, information, communication with other parts of China and the world, and religious
activities. The Xinjiang government has intensified the process of promoting Mandarin Chinese
and continued the demolition of parts of the old city of Kashgar. The whereabouts of many
Uighurs seized after the unrest remain unknown. Government initiatives to address grievances
have focused primarily upon increasing investment, developing the economy, and raising incomes
in the region, and secondarily upon preserving cultural items.
For more information about human rights in China, see CRS Report RL34729, Human Rights in
China: Trends and Policy Implications, by Thomas Lum and Hannah Fischer. For more
information on Chinese policy toward Xinjiang, see CRS Report RL33001, U.S.-China
Counterterrorism Cooperation: Issues for U.S. Policy, by Shirley A. Kan.
Security Issues
Nuclear Non-Proliferation
Nuclear non-proliferation has been a major priority for the Obama Administration. It has sought
to make cooperation on the issue a core component of the U.S.-China relationship, with a focus
on reining in the nuclear programs of Iran and North Korea. China, a nuclear power, a fellow
veto-wielding permanent member of the United Nations Security Council, and a party to the
Nuclear Non-proliferation Treaty, has supported United Nations sanctions against both countries.
In what the PRC government portrays as an indication of China’s commitment to the issue,
Chinese President Hu Jintao also traveled to Washington, DC, for the Nuclear Security Summit
hosted by the U.S. President in April 2010, despite Chinese unhappiness with the United States at
the time related to the President’s January 2010 notification of U.S. arms sales to Taiwan and
President Obama’s February 2010 meeting with Tibet’s exiled spiritual leader, the Dalai Lama.
Iran
Since 2006, China has been an important partner in U.S.- and European-led multilateral efforts to
rein in Iran’s suspected nuclear weapons program. China has participated in negotiations with
Iran over the program as part of the P5+1 grouping of the permanent members of the United
Nations Security Council plus Germany. It has also supported a series of United Nations (U.N.)
resolutions imposing limited U.N. sanctions against Iran, although it has frequently urged the use
of dialogue rather than sanctions to address the nuclear program. Influenced by its reliance on
crude oil imports from Iran and its investments in the Iranian energy and other sectors, however,
China, usually joined by Russia, has pushed for more narrowly targeted sanctions than the U.S.
and European nations sought. In the case of U.N. Resolution 1929, passed in June 2010, for
example, both China and Russia successfully insisted that new sanctions not target Iran’s civilian
economy or its population.
Since passage of U.N. Resolution 1929, the United States has sought to encourage China to
follow the lead of the United States and European Union countries in imposing bilateral sanctions
on Iran’s energy and financial sector that exceed those mandated in U.N. Security Council
resolutions. China has declined to impose its own bilateral sanctions and has criticized other
countries for doing so. U.S. officials give China credit, however, for not moving to take over
contracts given up by other countries, a behavior that the United States refers to as “backfilling.”
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The United States has implicated Chinese firms in sales to Iran of missile technology and
controlled chemicals. The Central Intelligence Agency’s latest report to Congress on the
Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional
Munitions, covering 2009, concludes that assistance from entities in China, North Korea and
Russia “has helped Iran move toward self-sufficiency in the production of ballistic missiles.”65
For more information, see CRS Report RS20871, Iran Sanctions, by Kenneth Katzman; CRS
Report RL32048, Iran: U.S. Concerns and Policy Responses, by Kenneth Katzman; and CRS
Report RL31555, China and Proliferation of Weapons of Mass Destruction and Missiles: Policy
Issues, by Shirley A. Kan.
North Korea
China fought on North Korea’s side in the Korean War and for decades after it officially described
the two countries’ relationship as being as close as “lips and teeth.” Since the early 1990s,
however, the relationship has been severely strained by North Korea’s decision to develop nuclear
weapons. China declared itself “resolutely opposed” to both North Korea’s nuclear tests, in 2006
and 2009.66 Chinese officials say they fear that a nuclear-armed North Korea could inspire South
Korea, Japan, and even Taiwan to acquire nuclear weapons, making China’s Asian neighborhood
a dramatically more dangerous place.
China has been active in its diplomacy to try to persuade North Korea to give up its nuclear
weapons program. In 2003, China helped to bring North Korea to the negotiating table through
the Six-Party Talks mechanism, which China hosts.67 In 2006, China supported U.N. Resolution
1718, condemning North Korea for its first nuclear test and imposing limited sanctions. In 2009,
China supported U.N. Resolution 1874, condemning North Korea’s second nuclear test and
imposing expanded sanctions, although U.S. officials say China has taken a minimalist approach
to enforcing those sanctions.68
Despite its unhappiness about North Korea’s nuclear program, China remains North Korea’s
largest supplier of fuel and food supplies,69 as well as its most powerful diplomatic ally. China
appears to believe that it is more likely to be able to moderate North Korean behavior through
engagement than through isolation of the regime. It is also believed to fear the consequences of a
65 Office of the Director of National Intelligence, Unclassified Report to Congress on the Acquisition of Technology
Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, Covering 1 January to 31 December
2009, March 2010, p. 4, http://www.dni.gov/reports/2009_721_Report.pdf.
66 In 2006, after North Korea’s first nuclear test, China’s Foreign Ministry issued a statement saying, “North Korea
ignored universal opposition of the international community and flagrantly conducted the nuclear test on Oct. 9. The
Chinese government is resolutely opposed to it.” In 2009, after North Korea’s second nuclear test, China’s Foreign
Ministry issued a statement saying, “The DPRK ignored universal opposition of the international community and once
more conducted the nuclear test. The Chinese government is resolutely opposed to it.” “China resolutely opposes N.
Korea’s Nuclear Test,” Xinhua, October 9, 2006, and “Chinese gov’t ‘resolutely opposes’ DPRK’s nuclear test,”
Xinhua, May 25, 2009.
67 The participants in the Six-Party Talks are China, Japan, North Korea, Russia, South Korea, and the United States.
68 See Mary Beth Nikitin, Emma Chanlett-Avery, and Mark Manyin, et al., Implementation of U.N. Security Council
Resolution 1874, CRS memo released by Senate Foreign Relations Committee, Washington, DC, October 8, 2010,
http://lugar.senate.gov/issues/foreign/reports/NKoreaCRSReport.pdf.
69 According to a 2003 fact sheet on the website of China’s Foreign Ministry, China has provided North Korea with aid
in the form of grain, coke, food oil, and fertilizer since 1994. Ministry of Foreign Affairs of the PRC, “DPRK: Bilateral
relations,” fact sheet, October 23, 2003, http://www.mfa.gov.cn/eng/wjb/zzjg/yzs/gjlb/2701/.
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collapse of the North Korean regime, which could include military hostilities, waves of North
Korean refugees flooding into China’s northeast provinces, and ultimately a reunified Korean
peninsula allied with the United States. A succession process underway in North Korea has
contributed to China’s sense of the North Korean regime’s fragility.
In 2010, to the dismay of U.S. officials, United States and PRC approaches to North Korea
diverged in important ways. While the United States sought to isolate North Korea in response to
a series of North Korean provocations, China stepped up its engagement, hosting two visits from
North Korea’s reclusive leader Kim Jong-il and sending a series of senior Communist Party
officials to Pyongyang. China also sought to shield North Korea from major diplomatic
repercussions for a series of its provocations, including the March 2010 sinking of a South
Korean naval vessel, the Cheonan; the November 2010 revelation it had built a sophisticated
uranium enrichment facility; and its November 2010 shelling of South Korea’s Yellow Sea island
of Yeonpyeong. U.S. officials tamped down their criticism of China’s approach after energetic
Chinese diplomacy appeared to pay dividends in the form of a January 2011 North Korean offer
to enter into unconditional talks with South Korea.
China’s treatment of North Korean refugees has been a particular concern for the Congress. China
considers North Koreans who have fled their homeland to China to be economic migrants, rather
than refugees. Its official policy is to repatriate them to North Korea, where they face prison camp
sentences or worse. North Korean refugees continue to trickle out of China to neighboring
countries in North and Southeast Asia, however, and a large number of North Korean refugees
continue to live underground in China.
For more information, see CRS Report R41043, China-North Korea Relations, by Dick K. Nanto
and Mark E. Manyin; CRS Report R40684, North Korea’s Second Nuclear Test: Implications of
U.N. Security Council Resolution 1874, coordinated by Mary Beth Nikitin and Mark E. Manyin;
CRS Report RL31555, China and Proliferation of Weapons of Mass Destruction and Missiles:
Policy Issues, by Shirley A. Kan; and CRS Report RS22973, Congress and U.S. Policy on North
Korean Human Rights and Refugees: Recent Legislation and Implementation, by Emma Chanlett-
Avery.
Chinese Military Modernization
China’s military continues to modernize rapidly, supported by more than two decades of steady
increases in military spending. According to the Pentagon’s 2010 report to Congress on China’s
military, China’s official military budget rose an average of 11.8% annually in inflation-adjusted
terms over the decade from 2000 to 2009. The Pentagon believes China’s actual military spending
to be more than twice the amount officially disclosed, estimating China’s total military-related
spending in 2009 at over $150 billion.70
With modernization, analysts believe China’s military is increasingly able to envision missions
beyond China’s immediate territorial interests. The Pentagon report welcomes the Chinese
military’s contributions to international peacekeeping efforts, humanitarian assistance and disaster
relief, and counter-piracy operations, but raises concerns about China’s new abilities to pursue
“anti-access and area-denial strategies” in the Western Pacific and its development of extended-
70 Office of the Secretary of Defense, Annual Report to Congress: Military and Security Developments Involving the
People’s Republic of China 2010, August 2010, pp. 42-43, http://www.defense.gov/pubs/pdfs/2010_CMPR_Final.pdf.
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range power projection capabilities. The Pentagon believes that China’s short-term focus remains
preparing for Taiwan-related contingencies, including the possibility that the United States
military will come to Taiwan’s aid if China tries to use force to bring Taiwan under its control.
The Pentagon report states: “The PLA is developing the capability to deter Taiwan independence
or influence Taiwan to settle the dispute on Beijing’s terms while simultaneously attempting to
deter, delay, or deny any possible U.S. support for the island in case of conflict.” The report adds
that, “the balance of cross-Strait military forces continues to shift in the mainland’s favor.”71
Analysts see China’s efforts to develop a stealth fighter jet and a missile capable of hitting
moving targets at sea as evidence of China’s commitment to the acquisition of the most modern
defense technology. China carried out the first test-flight for its J-20 stealth fighter during
Defense Secretary Robert M. Gates’ visit to China in January 2011. In addition, recognizing the
likely centrality of cyber operations to any future military conflict, China has been bolstering the
ability of its military to carry out computer network attacks and computer network defense.72
The U.S. military has long been troubled by China’s alleged lack of transparency about its
military intentions. In testimony before Congress in March 2010, Admiral Robert F. Willard, head
of the U.S. Pacific Command, stated that, “China’s interest in a peaceful and stable environment
that will support the country’s developmental goals is difficult to reconcile with the evolving
military capabilities that appear designed to challenge U.S. freedom of action in the region or
exercise aggression or coercion of its neighbors, including U.S. treaty allies and partners.”73
For more information, see CRS Report RL33153, China Naval Modernization: Implications for
U.S. Navy Capabilities—Background and Issues for Congress, by Ronald O'Rourke ; and CRS
Report RL30700, China’s Foreign Conventional Arms Acquisitions: Background and Analysis, by
Shirley A. Kan, Christopher Bolkcom, and Ronald O'Rourke.
U.S.-China Military-to-Military Relations
The military-to-military relationship remains among the least developed parts of the U.S.-China
relationship. Congress sought to limit the scope of the military relationship in the National
Defense Authorization Act for Fiscal Year 2000 (P.L. 106-65), when it barred exchanges or
contacts with China that include “inappropriate exposure” to a range of subjects, including
surveillance and reconnaissance operations and arms sales. But the Obama Administration has
pushed hard for a Chinese commitment to a “reliable and sustained” military relationship that
observes the law’s restrictions, arguing that, “the on-again-off-again cycle that has all too often
characterized the military-to-military relationship increases the risks and dangers of an incident or
accident that could derail the overall bilateral relationship.”74
71 Ibid, p. I.
72 Ibid, p. 7 and p. 37.
73 Admiral Robert F. Willard, “Statement on U.S. Pacific Command Posture,” Testimony Before the Senate Armed
Services Committee, March 24, 2010, p. 12, http://www.pacom.mil/web/pacom_resources/pdf/
Willard_Statement_SASC_032610.pdf.
74 Deputy Assistant Secretary of Defense for East Asia Michael Schiffer, “Building Cooperation in the U.S.-China
Military-to-Military Relationship,” Speech to the International Institute for Strategic Studies, Washington, DC, January
6, 2011, http://www.iiss.org/about-us/offices/washington/iiss-us-events/iiss-us-address-building-cooperation-in-the-us-
china-military-to-military-relationship/.
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China has been the more unwilling partner. Although President Obama and China’s President Hu
pledged in their 2009 Joint Statement to “take concrete steps to advance sustained and reliable
military-to-military relations in the future,” China continues to link the military relationship to the
issue of U.S. arms sales to Taiwan. Having suspended military-to-military relations in October
2008 over the issue of Taiwan arms sales by the George W. Bush Administration, China again
suspended the military-to-military relationship in January 2010, after the Obama Administration
notified Congress of a new $6.4 billion package of arms sales to Taiwan.
With President Hu’s state visit to the United States pending, the two countries agreed in
September 2010 to a resumption of military-to-military exchanges. They held the 11th round of
the U.S.-China Defense Consultative Talks in December 2010 and Secretary of Defense Robert
Gates made a long-delayed trip to China in January 2011. He and his Chinese counterpart agreed
to a program of exchanges including high level visits, institutionalized exchange programs, and
military education, and to cooperation in such non-traditional security areas as counterterrorism,
peacekeeping, counter-piracy, humanitarian assistance, and disaster relief. They also agreed to
establish a working group to develop “a new framework” for the military-to-military relationship.
In a joint press conference with Secretary Gates, however, China’s Minister of Defense Gen.
Liang Guanglie suggested that any future Taiwan arms sales could again disrupt the
relationship.75
For more information, see CRS Report RL32496, U.S.-China Military Contacts: Issues for
Congress, by Shirley A. Kan.
Maritime Disputes
U.S. Military Operations in China’s Exclusive Economic Zone
The United States and China disagree about the legality of U.S. military ships and planes
operating in and over waters near China. Although the United States is not a party to the United
Nations Convention on the Law of the Sea (UNCLOS), it interprets UNCLOS as allowing it to
conduct peaceful surveillance activities and other military activities without permission in a
country’s Exclusive Economic Zone (EEZ), defined by UNCLOS as extending from the edge of
the territorial sea to 200 nautical miles from the coast. With that understanding, the United States
military has long operated in China’s EEZ, carrying out air and naval surveillance missions to
monitor China’s military deployments and capabilities, surveying the ocean floor to facilitate
submarine navigation, and engaging in military exercises with allies such as South Korea and
Japan.
China, which is a party to UNCLOS, is one of a minority of nations that interprets the Convention
differently, arguing that UNCLOS allows countries to limit military activities in their EEZs.
China’s broad claims to disputed territory in the South China Sea and East China Sea mean that
China considers its EEZ to cover large, though ill defined, portions of both waterways, as well as
a significant, though also ill defined, portion of the Yellow Sea. In the first year of the Obama
75 In response to a question at the joint press conference, Minister Liang stated that, “United States arms sales to
Taiwan seriously damaged China’s core interests and we do not want to see that happen again; neither do we hope that
the U.S. arms sales to Taiwan will again and further disrupt our bilateral and military-to-military relationship.”
Department of Defense, “Joint Press conference with Secretary Gates and General Liang from Beijing, China,”
transcript, January 10, 2011, http://www.defense.gov/transcripts/transcript.aspx?transcriptid=4750.
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U.S.-China Relations: Policy Issues
Administration, China’s attempts to enforce its interpretation of UNCLOS resulted in several
dangerous encounters between U.S. naval vessels and Chinese naval and fishing vessels and at
least one Chinese maritime surveillance aircraft. In 2010, China reiterated its opposition to
foreign military activities in its EEZ in response to the announcement of joint military exercises
between the United States and South Korea in the Yellow Sea, following provocations by North
Korea.76
South China Sea
Chinese maps dating to before the Communist revolution appear to claim most of the South
China Sea as Chinese territory. China explicitly claims sovereignty over four groups of islets and
atolls and their undefined “adjacent waters,” which are rich in fishing resources and potentially in
oil and gas deposits. Those islets and atolls are the Paracels (known in Chinese as the Xisha), the
Spratlys (Nansha in Chinese), the entirely submerged Macclesfield Bank (Zhongsha in Chinese),
and the largely submerged Pratas (Dongsha in Chinese). Territory claimed by China is also
claimed in part by Brunei, Indonesia, Malaysia, the Philippines, and Vietnam, and in entirety by
Taiwan.
In the case of disputed maritime territory, China’s official policy is to set aside the issue of
sovereignty and pursue joint development with other claimants. As its economic and military
might has grown, however, China has appeared increasingly keen to assert its sovereignty in the
South China Sea. Examples of new Chinese assertiveness include China’s harassment of U.S.
surveillance vessels (see “U.S. Military Operations in China’s Exclusive Economic Zone,”
above); China’s dispatch of Fisheries Administration patrol vessels to “protect its sea territory”;77
Chinese pressure on international energy companies ExxonMobil and BP not to work with
Vietnam to explore for oil and gas in areas off Vietnam’s coast that China considers part of its
Exclusive Economic Zone; and China’s suggestion in some closed-door meetings with senior
U.S. officials in the spring of 2010 that China now considers the South China Sea a “core national
interest.”
Responding to the trend, and to provocative behavior by other claimants, in July 2010, Secretary
of State Hillary Clinton, speaking with the support of a dozen other Asia-Pacific nations, stated a
U.S. “national interest” in freedom of navigation and respect for international law in the South
China Sea. In comments widely interpreted as being aimed at China, she also stated that the
United States opposes “the use or threat of force by any claimant,” and “is prepared to facilitate
initiatives and confidence building measures” in the area, consistent with a 2002 agreement
between China and the Association of Southeast Asian Nations (ASEAN), the ASEAN-China
Declaration on the Conduct of Parties in the South China Sea.78 China’s Foreign Minister
76 In July 2010, China’s Foreign Minister Yang Jiechi told Secretary of State Hillary Clinton that China, “firmly
opposes foreign warships and military aircraft entering the Yellow Sea and other coastal waters of China to engage in
activities affecting China’s security and interests.” See Ministry of Foreign Affairs of the PRC, “Yang Jiechi Meets
with U.S. Secretary of State Clinton and Canadian Foreign Minister Cannon ,” press release, July 23, 2010,
http://www.china-embassy.org/eng/zmgx/t719784.htm. In November 2010, a Foreign Ministry spokesman declared
that, “We oppose any party to take any military acts in our exclusive economic zone without permission.” See “China
opposes any military acts in exclusive economic zone without permission,” Xinhua, November 26, 2010.
77 Zhang Xin, “China charts course toward secure South China Sea,” The China Daily, June 1, 2009.
78 Remarks at Press Availability, Hillary Rodham Clinton, Secretary of State, National Convention Center, Hanoi,
Vietnam, July 23, 2010, http://www.state.gov/secretary/rm/2010/07/145095.htm. The text of the Declaration on the
Conduct of Parties In the South China Sea can be found at http://www.aseansec.org/13163.htm. ASEAN comprises 10
(continued...)
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U.S.-China Relations: Policy Issues
declared Secretary Clinton’s comments to have been “in effect an attack on China,” and warned
the United States against making the South China Sea “an international issue or multilateral
issue.” 79 Tensions over the South China Sea have eased since her statement, with China agreeing
to discuss the drafting of implementing guidelines for a code of conduct with ASEAN
representatives.
East China Sea
In the East China Sea, China is involved in a territorial dispute with Japan and Taiwan over the
sovereignty of islands known in China as the Diaoyu, in Taiwan as the Diaoyutai, and in Japan as
the Senkakus. The islands are reportedly rich in fishing resources and oil and gas deposits. A
September 2010 collision between Japanese Coast Guard vessels and a Chinese fishing trawler
near the islands briefly raised the territorial dispute to the level of a major international crisis. It
also forced the United States to clarify that while it does not take a position on the sovereignty of
the islands, its security alliance with Japan covers all areas under Japanese administration,
including the Diaoyu/Diaoyutai/Senkakus, raising the sobering, if remote, possibility of a future
conflict between China and the United States over the islands.
In the September 2010 incident, China rapidly escalated pressure against Japan in order to force
Japan to release the Chinese trawler captain. Many observers saw China’s actions as
disproportionate, and perhaps as a harbinger of how a more powerful China might seek to assert
its will in the future. Most controversially, China was accused by Japan of imposing a temporary
“de facto ban” on exports to Japan of rare earths needed for defense and green technologies.
China denied that it had imposed such a ban.80
Taiwan
The island democracy of Taiwan, also known as the Republic of China, remains one of the most
sensitive and complex issues in bilateral U.S.-China relations, and the issue over which both sides
most actively continue to plan for the possibility of future military confrontation. Beijing claims
sovereignty over Taiwan, which has been self-governing since 1949, and vows to unite with it
eventually, either peacefully or by force. Chinese leaders support these long-standing claims with
a continuing build-up of over one thousand missiles deployed opposite Taiwan’s coast and with a
program of military modernization and training that defense experts believe is based on a
“Taiwan scenario.” (See “Chinese Military Modernization,” above.)
In the 1972 Shanghai Communiqué that paved the way for the establishment of diplomatic
relations between the United States and China, the United States declared that it “acknowledges
that all Chinese on either side of the Taiwan Strait maintain there is but one China and that
Taiwan is a part of China.” It also declared its “interest in a peaceful settlement of the Taiwan
(...continued)
Southeast Asian nations: Brunei, Cambodia, Indonesia, Lao, Malaysia, Myanmar, Philippines, Singapore, Thailand,
Vietnam.
79 Ministry of Foreign Affairs of the People’s Republic of China, Foreign Minister Yang Jiechi Refutes Fallacies on
the South China Sea Issue, Statement posted on website, July 25, 2010, http://www.mfa.gov.cn/eng/zxxx/t719460.htm.
80 For more information on rare earths, see CRS Report R41347, Rare Earth Elements: The Global Supply Chain, by
Marc Humphries.
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U.S.-China Relations: Policy Issues
question by the Chinese themselves.” In the 1979 Taiwan Relations Act (P.L. 96-8), Congress
reinforced the U.S. interest in a peaceful settlement, stating that it is U.S. policy that the
establishment of diplomatic relations with China “rests upon the expectation that the future of
Taiwan will be determined by peaceful means” and that it is similarly U.S. policy “to maintain the
capacity of the United States to resist any resort to force or other forms of coercion that would
jeopardize the security, or the social or economic system, of the people of Taiwan.”
In the years since, the United States has played a delicate role in managing its relations with
Beijing and Taipei, and the relations between the two. The United States has repeatedly assured
China that it does not support independence for Taiwan, but it has retained ambiguity about its
willingness to defend Taiwan in a conflict with China. That ambiguity is intended both to deter
China from attempting to use force to bring Taiwan under its control, and to deter Taiwan from
moves that might trigger China’s use of force, such as a declaration of formal independence. As
part of a statement known as the “Three No’s,” President Clinton also publicly stated that the
United States does not support Taiwan’s membership in any international organizations for which
statehood is a requirement.81 Complicating U.S. policy is the fact that Taiwan has blossomed into
a vibrant democracy. As Taiwan has sought to define its place in the world and expand its
“international space,” the United States has faced difficult questions about its role in constraining
the Taiwan people’s aspirations.
The Three Joint Communiqués and the Taiwan Relations Act
The governments of the United States and China consider three joint communiqués concluded in 1972, 1979, and
1982 to underpin their bilateral relationship. The United States considers The Taiwan Relations Act of 1979 to be a
fourth core document guiding the relationship, although China does not. The documents and their key statements are
listed below:
• The Shanghai Communiqué (Joint Communiqué, of the United States of America and the
People’s Republic of China), dated February 28, 1972. The United States declared that it “acknowledges
that all Chinese on either side of the Taiwan Strait maintain there is but one China and that Taiwan is a part of
China.” The United States also reaffirmed its “interest in a peaceful settlement of the Taiwan question by the
Chinese themselves” and committed as an “ultimate objective” to withdrawing all U.S. forces and military
installations from Taiwan.82
• Joint Communiqué on the Establishment of Diplomatic Relations between the United States of
America and the People’s Republic of China, dated January 1, 1979. The United States recognized the
government of the People’s Republic of China as the sole legal government of China and, in that context, stated
that “the people of the United States will maintain cultural, commercial, and other unofficial relations with the
people of Taiwan.”
• The August 17th Communiqué (Joint Communiqué of the United States of America and the
People’s Republic of China), dated August 17, 1982. The United States stated “that it does not seek to
carry out a long-term policy of arms sales to Taiwan, that its arms sales to Taiwan will not exceed, either in
qualitative or in quantitative terms, the level of those supplied in recent years … and that it intends gradually to
reduce its sale of arms to Taiwan, leading, over a period of time, to a final resolution.”
• The Taiwan Relations Act (TRA), enacted April 10, 1979. The TRA stated that it is U.S. policy “that the
United States decision to establish diplomatic relations with the People’s Republic of China rests upon the
expectation that the future of Taiwan will be determined by peaceful means.” The TRA also stated that it is U.S.
policy “to consider any effort to determine the future of Taiwan by other than peaceful means, including by
boycotts or embargoes, a threat to the peace and security of the Western Pacific area and of grave concern to
81 President Clinton’s statement, made on June 30, 1998, in Shanghai, was: “I had a chance to reiterate our Taiwan
policy which is that we don't support independence for Taiwan, or ‘two Chinas’, or ‘one Taiwan, one China’, and we
don't believe that Taiwan should be a member in any organization for which statehood is a requirement.”
82 The United States withdrew all military personnel from Taiwan in 1979, during the Carter Administration.
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U.S.-China Relations: Policy Issues
the United States,” and “to maintain the capacity of the United States to resist any resort to force or other
forms of coercion that would jeopardize the security, or the social or economic system, of the people on
Taiwan.” The law stated that, “the United States will make available to Taiwan such defense articles and defense
services in such quantity as may be necessary to enable Taiwan to maintain a sufficient self-defense capability.”
Cross-Strait Relations
The United States has long urged China to try harder to win over hearts and minds in Taiwan,
rather than threaten it with military force. It has welcomed the improvement of relations between
the two sides since 2008, when Ma Ying-jeou of the Kuomintang (KMT) Party won election as
president of Taiwan, ending eight years of rule by the independence-leaning Democratic
Progressive Party (DPP). Under President Ma, long-stalled official talks with China reconvened
in June 2008 in Beijing, resulting in groundbreaking agreements on direct charter flights, the
opening of permanent offices in each other’s territories, and Chinese tourist travel to Taiwan,
among others. Other rounds produced accords related to postal links, food safety, and Chinese
investment in Taiwan. 83
In April 2009, in an indication of greater flexibility on both sides, the World Health Organization
(WHO) invited Taiwan to attend the 2009 World Health Assembly (WHA) as an observer. 84 The
invitation, issued with China’s assent, marked the first time that Taiwan had been permitted to
participate in an activity of U.N. specialized agency since it lost its U.N. seat to China in 1971.
Taiwan is now seeking observer status in a second international body long closed to it, the
International Civil Aviation Organization.
Beijing and Taipei signed a landmark free trade arrangement, the Economic Cooperation
Framework Agreement (ECFA), in June 2010, removing many remaining barriers to trade and
investment across the Taiwan Strait and hastening cross-strait economic integration. That
integration has raised fears among some in both Taiwan and the United States about a possible
erosion of Taiwan’s autonomy. At the same time, it has increased the potential economic and
human costs of cross-strait conflict for both sides.
U.S. Arms Sales to Taiwan
According to many experts, U.S. arms sales to Taiwan remain the single greatest contributor to
Chinese mistrust of the United States. The PRC argues that U.S. arms sales embolden those in
Taiwan who seek Taiwan’s formal independence—China calls them “separatist forces”—and that
the arms sales are therefore destabilizing.85 China also charges that continued U.S. arms sales
83 The Taiwan and PRC governments conduct cross-strait talks through quasi-official organizations. In Taiwan, cross-
strait talks are handled by the Straits Exchange Foundation (SEF), a private organization authorized by the government
to handle these exchanges. The corresponding body in the PRC is the Association for Relations Across the Taiwan
Strait (ARATS).
84 Low, Y.F., “CNA: World Health Assembly’s Invitation Raises Taiwan’s International Profile,” Taipei Central News
Agency, April 29, 2009.
85 At a meeting in Singapore in June 2010, Ma Xiaotian, Deputy Chief of the General Staff of the Chinese military,
stated, in a reference to Taiwan, that “China has yet to achieve national unification and there is still support for the
separatist forces from outside the country.” Ma Xiaotian, “New Dimensions of Security,” Address to the 9th IISS Asian
Security Summit, the Shangri-La Dialogue, Singapore, June 5, 2010, http://www.iiss.org/conferences/the-shangri-la-
dialogue/shangri-la-dialogue-2010/plenary-session-speeches/second-plenary-session/ma-xiaotian/.
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U.S.-China Relations: Policy Issues
represent a betrayal of U.S. commitments under the August 17th Communiqué of 1982, in which
the United States stated its intention “gradually to reduce its sale of arms to Taiwan, leading, over
a period of time, to a final resolution.” Finally, Chinese scholars suggest that China increasingly
feels that the United States owes China concessions on Taiwan arms sales in recognition of
China’s economic might and China’s positive contributions on issues of importance to the United
States, such as Iran.86 The U.S. government argues that U.S. arms sales contribute to stability by
giving Taiwan’s leaders the confidence to engage with China. The United States also cites its
obligation under the Taiwan Relations Act (P.L. 96-8) to provide Taiwan with defense articles and
services “in such quantity as may be necessary to enable Taiwan to maintain a sufficient self-
defense capability.”
In January 2010, after President Obama notified Congress of a $6.4 billion package of arms sales
originally announced at the end of the George W. Bush Administration, including Patriot PAC
missiles and Blackhawk helicopters, Beijing denounced the move and suspended military-to-
military relations with the United States in protest. (See “U.S.-China Military-to-Military
Relations” above.) In May 2010, 136 Members of Congress wrote to President Obama urging him
to go further and authorize the sale of modern F-16 fighter aircraft (F-16 C/Ds) to Taiwan.87
China strenuously opposes the sale of F-16 C/Ds to Taiwan, arguing that they would represent a
qualitative leap in arms sales to Taiwan and break the U.S. pledge in the August 17th
Communiqué of 1982 not to sell arms sales to Taiwan that “exceed, either in qualitative or in
quantitative terms, the level of those supplied in recent years.”
For more information, see CRS Report R41263, Democratic Reforms in Taiwan: Issues for
Congress, by Shirley A. Kan; CRS Report RL30341, China/Taiwan: Evolution of the “One
China” Policy—Key Statements from Washington, Beijing, and Taipei, by Shirley A. Kan; and
CRS Report RL30957, Taiwan: Major U.S. Arms Sales Since 1990, by Shirley A. Kan.
86 Nina Hachigan and Yuan Peng, “The U.S.-China Expectations Gap: An Exchange,” Survival, vol. 52, no. 4 (2010).
87 Wendell Minnick, “U.S. Congress Pushes F-16 Release For Taiwan,” Defense News, May 18, 2010.
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Appendix A. Congressionally-Mandated Annual
Reports Related to China
Table A-1. Selected Executive Branch Reports to Congress on China
Authorizing
Agency Report
Title Contents Legislation
Department of
Military and Security
Chinese military
Section 1202,
Defense
Developments
technological
National Defense
Involving the
development;
Authorization Act,
People’s Republic of
Chinese security
FY 2000 (P.L. 106-
China
strategy and military
65), as amended
strategy; Chinese
military organizations
and operational
concepts; U.S.-China
engagement and
cooperation on
security matters
Department of
Report on Tibet
Steps taken to
Section 611, Foreign
State
Negotiations
encourage the PRC
Relations
government to enter
Authorization Act,
into a dialogue with
FY2003, “Tibetan
the Dalai Lama or his Policy Act of 2002,”
representatives
(P.L. 107-228)
leading to a
negotiated
agreement on Tibet,
and status of any
such dialogue
United States
China’s WTO
China’s compliance
Sections 421 and
Trade
Compliance
with commitments
413(b)(2) of the U.S.-
Representative
made in connection
China Relations Act
with its accession to
of 2000 (P.L. 106-
the World Trade
286)
Organization
Congressional Research Service
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U.S.-China Relations: Policy Issues
Table A-2. Selected Executive Branch Reports to Congress Related to China
Authorizing
Agency Report
Title Contents Legislation
Central Intelligence Unclassified Report
Acquisition by
Section 721,
Agency (submitted
to Congress on the
foreign countries of
Intelligence
by the Deputy
Acquisition of
dual-use and other
Authorization Act
Director of
Technology Relating
technology useful for
for FY1997 (P.L. 104-
National
to Weapons of Mass
the development of
293)
Intelligence for
Destruction and
weapons of mass
Analysis)
Advanced
destruction and
Conventional
advanced
Munitions
conventional
munitions
Department of
Country Reports on
Status of
Sections 116(d) and
State
Human Rights
internationally
502B(b) of the
Practices (China
recognized human
Foreign Assistance
report includes
rights as set forth in
Act of 1961 (FAA)
separate section on
the Universal
(P.L. 87-195), as
Tibet. Hong Kong,
Declaration of
amended, and
and Macau have
Human Rights
section 504 of the
separate reports.)
Trade Act of 1974
(P.L. 93-618), as
amended
Department of
Country Reports on
Foreign government
Section 140, Foreign
State
Terrorism (China
counter-terrorism
Relations
report includes
cooperation
Authorization Act,
separate sections on
FY1988-1989 (P.L.
Hong Kong and
100-204), as
Macau)
amended
Department of
International
Drug and chemical
Section 489, Foreign
State
Narcotics Control
control, money
Assistance Act of
Strategy Report
laundering, and
1961 (FAA) (P.L. 87-
financial crimes
195), as amended
Department of
Annual Report on
Supplements most
Section 102(b),
State
International
recent human rights
International
Religious Freedom
reports with detailed
Religious Freedom
(Separate reports on
information on
Act of 1998 (P.L.
Tibet, Hong Kong,
matters involving
105-292)
and Macau are
international
appended to the
religious freedom
China report)
Department of
Trafficking in Persons Foreign government
Section 104, Victims
State
Report
efforts to eliminate
of Trafficking and
severe forms of
Violence Protection
trafficking in persons, Act of 2000 (P.L.
such as forced labor
106-386)
and sex trafficking
Congressional Research Service
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U.S.-China Relations: Policy Issues
Authorizing
Agency Report
Title Contents Legislation
Department of
Voting Practices in
Information on
Section 406, Foreign
State
the United Nations
voting practices of al Relations
UN members. Lists
Authorization Act
each country’s votes
for FY 1990-1991
on “important
(P.L. 101-246)
issues” and provides
statistics on
coincidence of each
country’s votes with
U.S. votes
Department of
Report to Congress
International
Section 3005,
Treasury
on International
economic policy,
Omnibus Trade and
Economic and
including exchange
Competitiveness Act
Exchange Rate
rate policy
of 1988 (P.L. 100-
Policies
418)
United States
National Trade
Inventory of the
Section 181,Trade
Trade
Estimate Report on
most important
Act of 1974 (P.L. 93-
Representative
Foreign Trade
foreign barriers
618), as amended
Barriers
affecting U.S. exports
of goods and
services, foreign
direct investment by
U.S. persons, and
protection of
intellectual property
rights
United States
Special 301 Report
Global review of the
Section 182, Trade
Trade
state of intellectual
Act of 1974 (P.L. 93-
Representative
property rights
618), as amended
protection and
enforcement
Table A-3. Selected Reports on China By Congressionally-Mandated Commissions
Commission Report
Contents
Authorizing
Legislation
Congressional-Executive
Annual Report
Human rights and rule of
Section 302(g), U.S.-China
Commission on the
law in China
Relations Act of 2000 (P.L.
People’s Republic of
106-286), as amended
China
U.S.-China Economic
Report to Congress
The national security
Section 1238(c), Floyd D.
and Security Review
implications of the U.S.-
Spence National Defense
Commission
China bilateral trade and
Authorization Act for 2001
economic relationship
(P.L. 106-398), as amended
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U.S.-China Relations: Policy Issues
Appendix B. Legislation Related to China
Introduced in the 111th Congress
Table B-1. Economic Legislation Related to China
Date of Major Action
Legislative
(Introduced and Sent to
Bill Number
Sponsor
Relevant Committee or Passed)
Title/Description
H.Res. 44
Poe
Intr. January 9, 2009
Condemning the PRC for
unacceptable business practices.
H.R. 471
Altmire
Intr. January 13, 2009
The Supporting America’s
Manufacturers Act.
H.R. 496
Rangel
Intr. January 14, 2009
Trade Enforcement Act of 2009.
H.R. 499
Davis Intr. January 14, 2009
Nonmarket Economy Trade Remedy
Act of 2009.
S.Res. 739/
Nelson/Wexler Intr. March 30, 2009/April 2, 2009
Drywal Safety Act of 2009.
H.R. 1977
H.R. 2310/
Larsen/Cantwel
Intr. May 7, 2009/May 8, 2009
United States-China Market
S. 1616
Engagement and Export Promotion
Act.
S. 3134
Schumer
Intr. March 17, 2010
Currency Exchange Rate Oversight
Reform Act of 2010.
S. 3240
Cornyn
Intr. April 21, 2010
Foreign-Held Debt Transparency and
Threat Assessment Act.
H.R. 5312
Schauer
Intr. May 13, 2010
Reciprocal Government Procurement
with China Creates American Jobs
Act.
H.R. 5319
Johnson
Intr. May 18, 2010
Foreign-Held Debt Transparency and
Threat Assessment Act.
S. 3505
Stabenow
Intr. June 17, 2010
China Fair Trade Act of 2010.
H.R. 6071
Sherman
Intr. July 30, 2010
Emergency China Trade Act of 2010.
H.R. 2378
Ryan
Passed in the House, September 29,
Currency Reform for Fair Trade Act.
2010
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Table B-2. Human Rights Legislation Related to China
Date of Major
Action
(Introduced and
Sent to Relevant
Bill
Legislative
Committee or
Number
Sponsor
Passed)
Title/Description
S.Res. 24 Casey
Intr. January 28,
A resolution commending China’s Charter 08 movement
2009
and related efforts for upholding the universality of human
rights and advancing democratic reforms in China.
H.Res. 156
McCotter
Intr. February 11,
Supporting Charter 08 and the ideals of the Charter 08
2009
movement.
H.R. 1340
Miller Intr.
March
5,
2009
Tibetan Refugee Assistance Act of 2009.
H.Res. 226
Holt
Passed March 11,
A resolution recognizing the plight of the Tibetan people
2009
and calling for a sustained multilateral effort to bring about a
durable and peaceful solution to the Tibet issue.
H.R. 2271
Smith
Intr. May 6, 2009
Global Online Freedom Act.
S.Res. 155
Brown
Intr. May 21, 2009
A resolution expressing the sense of the Senate that the
Government of the People’s Republic of China should
immediately cease engaging in acts of cultural, linguistic, and
religious suppression directed against the Uyghur people.
S.Res. 171
Inhofe
Passed June 8, 2009
A resolution commending the people who have sacrificed
their personal freedoms to bring about democratic change
in the People’s Republic of China and expressing sympathy
for the families of the people who were killed, wounded, or
imprisoned on the occasion of the 20th anniversary of the
Tiananmen Square Massacre in Beijing, China from June 3
through 4, 1989.
H.Res. 590
Wu
Intr. June 26, 2009
Expressing grave concerns about the sweeping censorship,
privacy, and cyber-security implications of China’s Green
Dam filtering software, and urging U.S. high-tech companies
to promote the Internet as a tool for transparency and
freedom of expression.
H.Res. 624 Delahunt Intr. July 10, 2009
Condemning al violent repression by the Government of
the People’s Republic of China of peaceful Uighur protests.
H.Con.Res.
Minnick
Passed in the House, Expressing the sense of Congress that China release
151
October 1, 2009
democratic activist Liu Xiaobo from imprisonment.
H.Res. 877
Wu
Passed November 7,
Expressing support for Chinese human rights activists Huang
2009
Qi and Tan Zuoren for engaging in peaceful expression as
they seek answers and justice for the parents whose
children were killed in the Sichuan earthquake of May 12,
2008.
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U.S.-China Relations: Policy Issues
Date of Major
Action
(Introduced and
Sent to Relevant
Bill
Legislative
Committee or
Number
Sponsor
Passed)
Title/Description
H.Res. 953
McGovern
Intr. December 8,
Expressing the sense of the House of Representatives that
2009
the Government of the People’s Republic of China has
violated internationally recognized human rights and legal
due process standards by carrying out executions after trials
marred by procedural abuses and by carrying out arbitrary
detentions targeting Uyghurs and other individuals in
Xinjiang in the aftermath of a suppressed demonstration and
ensuing mob violence on July 5 to 7, 2009.
S.Res. 405
Kaufman
Passed February 2,
A resolution reaffirming the centrality of freedom of
2010
expression and press freedom as cornerstones of United
States foreign policy and United States efforts to promote
individual rights, and for other purposes.
H.Res. 605 Ros-
Passed March 16,
Recognizing the continued persecution of Falun Gong
Lehtinen
2010.
practitioners in China on the 10th anniversary of the Chinese
Communist Party campaign to suppress the Falun Gong
spiritual movement and calling for an immediate end to the
campaign to persecute, intimidate, imprison, and torture
Falun Gong practitioners.
H.Res.
McCarthy
Intr. July 13, 2010
Commending Google Inc. and other companies for
1512
advocating for an uncensored Internet, adhering to free
speech principles, and keeping the Internet open for users
worldwide.
H.Res.
Smith
Intr. September 22,
Calling on the Government of the People's Republic of
1650
2010
China to immediately release Chen Guangcheng and his
relatives from house arrest and to cease persecuting and
harassing Chen Guangcheng, his relatives, and supporters.
H.Res.
Smith
Passed December 8,
Congratulating imprisoned Chinese democracy advocate Liu
1717
2010
Xiaobo on the award of the 2010 Nobel Peace Prize.
Congressional Research Service
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U.S.-China Relations: Policy Issues
Table B-3. Environment/Energy Legislation Related to China
Date of Major Action
(Introduced and Sent
Bill
Legislative
to Relevant
Number
Sponsor
Committee or Passed)
Title/Description
S.Res. 76 Cantwell
Intr. March 18, 2009
A resolution expressing the sense of the Senate that the
United States and the People’s Republic of China should
work together to reduce or eliminate tariff and nontariff
barriers to trade in clean energy and environmental
goods and services.
S.Res. 77 Cantwell
Intr. March 18, 2009
A resolution expressing the sense of the Senate that the
United States and the People’s Republic of China should
negotiate a bilateral agreement on clean energy
cooperation.
H.R.
Israel
Intr. May 7, 2009
United States-China Energy Cooperation Act.
2312
Table B-4. Other Legislation Related to China
Date of Major Action
(Introduced and Sent to
Bill
Legislative
Relevant Committee or
Number
Sponsor
Passed)
Title/Description
H.Con.Res.
Forbes
Intr. March 12, 2009
Condemning any action of the PRC that
72
unnecessarily escalates bilateral tensions, including
the incidents in the South China Sea against the
USNS Impeccable in March 2009.
H.R. 2311
Kirk
Intr. May 7, 2009
United States-China Diplomatic Expansion Act of
2009.
H.R. 2313
Davis
Intr. May 7, 2009
U.S.-China Language Engagement Act.
H.Res. 509 Hastings
Intr. June 4, 2009
Encouraging the United States to ful y participate in
the Shanghai Expo in 2010.
S.Res. 217
Kerry
Intro. July 20, 2009
A resolution commending Captain Wei Jiafu and
the China Ocean Shipping Company for increasing
business relations between the United States and
China.
H.Res. 784 Green
Passed October 28, 2009
Honoring the 2560th anniversary of the birth of
Confucius and recognizing his invaluable
contributions to philosophy and social and political
thought.
S.Res. 532
Kerry
Intr. May 17, 2010
A resolution recognizing Expo 2010 Shanghai,
China and the USA Pavilion at the Expo.
H.Res. 1324 McMahon
Passed May 20, 2010
Expressing condolences and sympathies for the
people of China fol owing the tragic earthquake in
the Qinghai province of the Peoples Republic of
China on April 14, 2010.
Congressional Research Service
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U.S.-China Relations: Policy Issues
Author Contact Information
Susan V. Lawrence
Thomas Lum
Analyst in Asian Affairs
Specialist in Asian Affairs
slawrence@crs.loc.gov, 7-2577
tlum@crs.loc.gov, 7-7616
Congressional Research Service
39