U.S.-China Relations: Policy Issues
Susan V. Lawrence
Specialist in Asian Affairs
June 14, 2013
Congressional Research Service
7-5700
www.crs.gov
R41108
CRS Report for Congress
Pr
epared for Members and Committees of Congress
U.S.-China Relations: Policy Issues
Summary
Congress faces important questions about what sort of relationship the United States should have
with China and how the United States should respond to China’s “rise.” After 30 years of fast-
paced economic growth, China’s economy is now the second-largest in the world after the United
States. With economic success, China has developed significant global strategic clout. It is also
engaged in an ambitious military modernization drive, including development of extended-range
power projection capabilities and such advanced weapons as a “carrier killer” anti-ship ballistic
missile (ASBM). At home, it continues to suppress all perceived challenges to the Communist
Party’s monopoly on power.
In previous eras, the rise of new powers has often produced conflict. President Obama and
China’s leader Xi Jinping have embraced the challenge of establishing a “new style great power
relationship” that avoids such an outcome. The Obama Administration has repeatedly assured
China that the United States “welcomes a strong, prosperous and successful China that plays a
greater role in world affairs,” and that the United States does not seek to prevent China’s re-
emergence as a great power. Washington has wrestled, however, with how to engage China on
issues affecting stability and security in the Asia-Pacific region. Issues of concern for Washington
include the intentions behind China’s military modernization program, China’s use of its
paramilitary forces and military in disputes with its neighbors over territorial claims in the South
China Sea and East China Sea, and its continuing threat to use force to bring Taiwan under its
control. With U.S.-China military-to-military ties fragile, Washington has struggled to convince
Beijing that the U.S. policy of rebalancing toward the Asia Pacific is not intended to contain
China. The two countries have cooperated, with mixed results, to address nuclear proliferation
concerns related to Iran and North Korea.
While working with China to revive the global economy, the United States has also wrestled with
how to persuade China to address economic policies and activities the United States sees as
denying a level playing field to U.S. firms trading with and operating in China. At the top of the
U.S. agenda is commercial cyber espionage that the U.S. government says appears to be directly
attributable to the Chinese government and military. Other economic concerns for the United
States include China’s “indigenous innovation” industrial policies, its weak protections for
intellectual property rights, and its currency policy. The United States has differed with China
over approaches to combating climate change, while cooperating with China in the development
of clean energy technologies. Human rights remains one of the thorniest areas of the relationship,
with the United States pressing China to ease restrictions on freedom of speech, internet freedom,
religious and ethnic minorities, and labor rights, and China’s leaders suspicious that the United
States’ real goal is to end Communist Party rule.
This report opens with an overview of the U.S.-China relationship, recent developments in the
relationship, Obama Administration policy toward China, and a summary of legislation related to
China in the 113th and 112th Congresses. The report then reviews major policy issues in the
relationship. Throughout, the report directs the reader to other CRS reports for more detailed
information about individual topics. This report will be updated periodically. A detailed summary
of 113th and 112th Congress legislative provisions and hearings related to China is provided in
appendices.
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U.S.-China Relations: Policy Issues
Contents
Overview of U.S.-China Relations .................................................................................................. 1
Recent Developments ...................................................................................................................... 3
June 7-8, 2013: The Presidential Summit in Rancho Mirage, CA ...................................... 3
June 8, 2013: Reported Leaks Involving Intelligence Collection Programs and Hong
Kong ....................................................................................................................................... 4
Obama Administration Policy on China .......................................................................................... 5
The Policy of Strategic Rebalancing to the Asia-Pacific ........................................................... 6
Forging a “New Model of Cooperation” with China ................................................................. 7
Bilateral Engagement ................................................................................................................ 8
Multilateral Engagement ........................................................................................................... 9
Outreach to the Chinese Public ............................................................................................... 10
Visa Issuance ........................................................................................................................... 11
Congressional Action Related to China in the 113th and 112th Congresses .................................... 12
Select Policy Issues ........................................................................................................................ 15
Security Issues ......................................................................................................................... 15
The U.S.-China Military-to-Military Relationship ............................................................ 15
Chinese Military Modernization ....................................................................................... 17
Cyber Activities Directed Against U.S. National Defense Programs ................................ 19
China’s Reaction to U.S. Strategic Rebalancing To the Asia-Pacific ................................ 19
Maritime Territorial Disputes ............................................................................................ 21
Exclusive Economic Zone (EEZ) Disputes ....................................................................... 23
Managing North Korea ...................................................................................................... 25
Curbing Iran’s Nuclear Program ....................................................................................... 26
Resolving the Crisis in Syria ............................................................................................. 28
Taiwan ..................................................................................................................................... 28
Cross-Strait Relations ........................................................................................................ 30
U.S. Arms Sales to Taiwan ................................................................................................ 32
Economic Issues ...................................................................................................................... 32
Basic Facts About the U.S.-China Economic Relationship ............................................... 33
Commercial Cyber Espionage ........................................................................................... 34
Global Rebalancing and China’s 12th Five-Year Plan ....................................................... 35
The Bilateral Trade Deficit ................................................................................................ 36
China’s Currency Policy .................................................................................................... 37
China’s Holdings of U.S. Treasuries ................................................................................. 38
China’s “Indigenous Innovation” Policies ........................................................................ 39
China’s Enforcement of Intellectual Property Rights (IPR) .............................................. 39
China’s Compliance with World Trade Organization (WTO) Commitments ................... 40
Chinese Foreign Direct Investment in the United States ................................................... 41
Climate Change and Renewable Energy Cooperation ............................................................. 42
Democracy Promotion and Human Rights Issues ................................................................... 45
The Annual State Department Human Rights Report on China and
China’s Response ........................................................................................................... 46
U.S.-China Dialogues on Human Rights........................................................................... 47
U.S. Assistance to China ................................................................................................... 47
Political Prisoners .............................................................................................................. 47
Tibet .................................................................................................................................. 49
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Treatment of Uighurs ........................................................................................................ 50
Tables
Table 1. U.S. Merchandise Trade with China over Time ............................................................... 37
Table A-1. Law Related to China Enacted in the 113th Congress .................................................. 52
Table A-2. Simple Resolution Related to China Agreed to in the House
in the 113th Congress................................................................................................................... 53
Appendixes
Appendix A. Laws Related to China Enacted in the 113th Congress ............................................. 52
Appendix B. Laws Related to China Enacted in the 112th Congress ............................................. 54
Appendix C. Simple Resolutions Agreed to in the 112th Congress ................................................ 59
Appendix D. Hearings Related to China in the 112th Congress ..................................................... 62
Contacts
Author Contact Information........................................................................................................... 64
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Overview of U.S.-China Relations
As China’s economic and strategic clout has grown over the last three decades, the United States’
relationship with China has expanded to encompass a broad range of global, regional, and
bilateral issues. With China’s economy now the second largest in the world, Washington seeks
Beijing’s cooperation in rebalancing the global economy and sustaining global growth. It hopes
that China, a fellow permanent member of the United Nations Security Council, will help block
the nuclear ambitions of Iran and North Korea and assist in resolving the crisis in Syria. The
United States also seeks to encourage China to contribute to peace and stability in the Asia-
Pacific, including in the Taiwan Strait, the South China Sea, and the East China Sea. With the
United States focused on restoring its economic strength, Washington is seeking to achieve a so-
called level playing field for U.S. firms that trade with and operate in China; to address cyber
intrusions allegedly originating from China that target trade and military secrets; and to attract
foreign direct investment from China. With the United States and China now the two largest
emitters of greenhouse gases, Washington seeks Beijing’s cooperation in reaching a new
international agreement on steps to address climate change. Finally, while engaging with China’s
authoritarian Communist government, the United States also seeks to promote human rights and
the rule of law in China, including in the ethnic minority regions of Tibet and Xinjiang.
Hanging over the relationship is the larger question of whether, as China grows in economic and
military power, the United States and China can manage their relationship in such a way as to
avoid debilitating rivalry and conflict that have accompanied the rise of new powers in previous
eras. On a visit to the United States in February 2012, Xi Jinping, who became China’s top leader
later in the year, proposed that the two countries establish a “new type of great power
relationship” that explicitly seeks to avoid conflict. President Obama has accepted the challenge.
He described a June 7-8, 2013, summit with Xi in Rancho Mirage, CA, as an opportunity for
conversations about “how we can forge a new model of cooperation between countries based on
mutual interest and mutual respect.”1 Some principles for this “new model” U.S.-China
relationship are already in place. The Obama Administration has repeatedly assured China that it
“welcomes a strong, prosperous and successful China that plays a greater role in world affairs,”
and China has stated that it “welcomes the United States as an Asia-Pacific nation that contributes
to peace, stability, and prosperity in the region.”2 But the “new model” remains a work in
progress, with many observers in both Washington and Beijing noting deep mistrust on both sides
of the U.S.-China relationship. (See “Forging a “New Model of Cooperation” with China,”
below.)
Xi and his Chinese leadership colleagues assumed their Communist Party posts at the Party’s 18th
Congress in November 2012, and added other posts, in Xi’s case the state presidency, at the
annual meeting of the National People’s Congress in March 2013. In their early months in office,
China’s new leaders have signaled a strong desire to strengthen the U.S.-China relationship. The
Obama Administration credits them with being willing to go beyond their predecessors on several
issues of concern to the United States. China has shown somewhat greater willingness to pressure
North Korea over its nuclear program. A trip to China in April 2013 by the Chairman of the Joint
Chiefs of Staff, General Martin Dempsey, elicited some of the most unambiguous language yet
1 The White House Office of the Press Secretary, “Remarks by President Obama and President Xi Jinping of the
People’s Republic of China Before Bilateral Meeting,” transcript, June 7, 2013.
2 Both statements are contained in Joint Statements between the two governments issued in 2009 and 2011.
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from China’s People’s Liberation Army signaling acceptance of the United States military
presence in Asia.3 The Obama-Xi summit in June 2013 produced an agreement for the United
States and China to work together to combat global climate change by reducing the consumption
and production of hydrofluorocarbons (HFCs),4 and Secretary of State John Kerry’s April 2013
visit to China produced an unprecedented stand-alone joint statement on climate change.5 China
has also agreed to the establishment of a high-level working group on cybersecurity, although the
two presidents appeared to make little progress on the issue in their June 2013 meetings. The
United States charges that cyber intrusions into U.S. government and private networks “appear to
be attributable directly to the Chinese government and military.”6
Yet overall, the U.S.-China relationship remains dogged 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 sometimes brutal
suppression of dissent and see continued Communist Party rule in a post-Cold War world as an
anachronism. Some in China believe that when the United States presses China to ease
restrictions on freedom of speech and internet freedom, improve its treatment of religious
practitioners and ethnic minorities, and respect the legal rights of its citizens, the United States’
real goal is to destabilize China and push the Communist Party from power.
Although the U.S. and Chinese economies are heavily interdependent, the two countries’ different
economic models have contributed to mistrust. The state plays a major role in the Chinese
economy, with state-owned corporations dominating the ranks of China’s biggest businesses.
China’s economy also differs from the United States’ in its growth model, which has so far
depended heavily on exports and investment, rather than consumption. Points of contention in the
bilateral economic relationship include the United States’ allegations of Chinese cyberespionage
targeting U.S. corporations and government agencies, the related issue of China’s inability or
unwillingness to prevent violations of foreign intellectual property by Chinese entities, and
Chinese industrial policies that appear to be intended to help Chinese domestic firms climb the
“value chain” by discriminating against foreign firms. For their part, PRC officials have criticized
the United States for its high levels of consumption, long-term debt, expansionary monetary
policy, and barriers to Chinese investment in the United States.
Mistrust is particularly pronounced on security matters. The U.S. government sees China’s
military modernization as aimed, in part, at constraining the U.S. military’s freedom of movement
in Asia and deterring U.S. intervention in the event of Chinese use of force against Taiwan. An
immediate concern is that China’s use of coercion in disputes with its neighbors over territory in
the East China Sea and the South China Sea could undermine the stability upon which the
prosperity of the region depends. For their part, some in China’s government have been unnerved
3 The general’s Chinese counterpart, Gen. Fang Fenghui, told a press conference that China respects “the legitimate
right[s] and interest[s] of the United States in the Asia-Pacific region” and added that, “The Asia-Pacific region should
be a platform for China-U.S. cooperation.” Joint Chiefs of Staff, “Gen. Dempsey and Gen. Fang Fenghui’s Joint
Presser in Beijing,” press release, April 24, 2013, http://www.jcs.mil/speech.aspx?id=1766.
4 The White House Office of the Press Secretary, “United States and China Agree to Work Together on Phase Down of
HFCs,” press release, June 8, 2013, http://www.whitehouse.gov/the-press-office/2013/06/08/united-states-and-china-
agree-work-together-phase-down-hfcs.
5 Department of State, “Joint U.S.-China Statement on Climate Change,” press release, April 13, 2013,
http://www.state.gov/r/pa/prs/ps/2013/04/207465.htm.
6 Department of Defense, Military and Security Developments Involving the People’s Republic of China 2013: Annual
Report to Congress, p. 36, http://www.defense.gov/pubs/2013_china_report_final.pdf.
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by the late 2011 announcement of a U.S. policy of strategic rebalancing toward Asia, seeing it as
emboldening China’s rivals in territorial disputes and seeking to constrain the activities of the
Chinese military. The most long-standing source of grievance for China on the security side of the
bilateral relationship is U.S. policy toward Taiwan, which many in China see as intended to
thwart the PRC’s unification with Taiwan, a cherished PRC goal.
Recent Developments
June 7-8, 2013: The Presidential Summit in Rancho Mirage, CA
As noted above, President Obama and China’s President Xi met June 7-8, 2013, for an unusual
informal-style summit at the Sunnylands Estate in Rancho Mirage, CA. It was their first face-to-
face meeting since Xi took office as General Secretary of China’s Communist Party in November
2012 and as State President in March 2013. Without the rapidly arranged summit, the two
presidents would not have been scheduled to meet until the G-20 meeting in St. Petersburg,
Russia, in September 2013.
The two men held nearly eight hours of discussions over the two days, a length of time that
allowed them to explore a wide range of topics. With many in China believing that the United
States sees China as a threat to U.S. primacy in the Asia-Pacific, Obama assured his Chinese
counterpart that, “it is very much in the interest of the United States for China to continue its
peaceful rise, because if China is successful, that helps to drive the world economy and it puts
China in the position to work with us as equal partners in dealing with many of the global
challenges that no single nation can address by itself.” For his part, Xi assured Obama that,
“China will be firmly committed to the path of peaceful development and China will be firm in
deepening reform and opening up the country wider to the world.” China, he said, is working “to
realize the Chinese dream of the great national renewal,” which he said was “about cooperation,
development, peace, and win-win.” He also reiterated China’s acceptance of the United States
presence in Asia, observing, “When I visited the United States last year, I stated that the vast
Pacific Ocean has enough space for the two large countries of China and the United States. I still
believe so.”7
For the Obama Administration, one highlight of the meeting was what National Security Advisor
Tom Donilon described as “quite a bit of alignment” in the two leaders’ positions on North
Korea’s nuclear program. After the summit, Donilon also reported that China now
“acknowledged” U.S. concerns about what Donilon termed “cyber-enabled economic theft” by
entities in China, and he said China had agreed to “to look at this.”8 In addition, the two sides
announced at the summit the agreement to work together and with other countries to reduce their
production and consumption of hydrofluorocarbons (HFCs), greenhouse gases that contribute to
climate change.
7 The White House Office of the Press Secretary, “Remarks by President Obama and President Xi Jinping of the
People’s Republic of China After Bilateral Meeting,” transcript, June 8, 2013, http://www.whitehouse.gov/the-press-
office/2013/06/08/remarks-president-obama-and-president-xi-jinping-peoples-republic-china-.
8 The White House Office of the Press Secretary, “Press Briefing by National Security Advisor Tom Donilon,”
transcript, June 8, 2013, http://www.whitehouse.gov/the-press-office/2013/06/09/press-briefing-national-security-
advisor-tom-donilon.
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A post-summit briefing by China’s top diplomat, State Councilor Yang Jiechi, underlined many
continuing points of contention in the bilateral relationship, however. According to Yang,
President Xi urged President Obama to “stop selling weapon[s] to Taiwan.” Xi also called on the
United States to relax restrictions on high-technology exports to China, and to “create a fair
environment for investment by Chinese enterprises in America,” indicating that China believes
the current environment is not fair. Neither Xi, in his and Obama’s two question-and-answer
sessions with the media, nor Yang in his briefing, acknowledged that Chinese entities might be
responsible for cyber-enabled theft of U.S. intellectual property and other information. Yang
focused instead on what he said was agreement that the two countries should work through the
United Nations to promote establishment of an “international internet management mechanism,”
although China’s calls for such a mechanism have long been rooted in a desire to control flows of
information. On North Korea, Yang agreed that China and the United States are united in insisting
that North Korea must denuclearize, but he did not mention what Donilon described as the two
leaders’ “full agreement” that “Security Council resolutions which put pressure on North Korea
need to be enforced.” Moreover, while Donilon said Obama and Xi discussed the need for Six-
Party Talks over North Korea’s nuclear program to resume only if they can be “authentic and
credible” and “actually lead to a sensible result,” Yang did not acknowledge such conditions,
stating simply that, “It becomes imperative to resume dialogue as soon as possible.”9
June 8, 2013: Reported Leaks Involving Intelligence Collection
Programs and Hong Kong
On June 8, 2013, the second day of the Obama-Xi summit, Britain’s Guardian newspaper
released an interview with a former contractor for the National Security Agency (NSA), Edward
Snowden, in which he claimed responsibility for leaks to the paper of classified information about
U.S. government intelligence collection programs.10 In the interview, Snowden revealed that he
had boarded a flight from his home in Hawaii to Hong Kong on May 20, 2013, and that he
remained in the Chinese city. Snowden’s presence in Hong Kong, a Special Administrative
Region of China, has posed unexpected challenges for the U.S.-China relationship at a time when
the Obama-Xi summit was meant to set the stage for an effort to forge greater cooperation
between the two countries.
Snowden said in the Guardian interview that he chose Hong Kong because “they have a spirited
commitment to free speech and the right of political dissent.” Under the terms of Hong Kong’s
1997 reversion to Chinese sovereignty after a century and a half as a British colony, China
granted Hong Kong autonomy for 50 years in all matters except defense and foreign affairs under
the principle of “one country, two systems.” Hong Kong therefore has an independent judiciary. It
9 Yang Jiechi’s Remarks on the Results of the Presidential Meeting between Xi Jinping and Obama at the Annenberg
Estate, press release, June 9, 2013, http://www.fmprc.gov.cn/eng/zxxx/t1049263.shtml.
10 Glenn Greenwald, Ewen MacAskill, and Laura Poitras, “Edward Snowden: The Whistleblower Behind the NSA
Surveillance Revelations,” The Guardian, June 8, 2013, http://www.guardian.co.uk/world/2013/jun/09/edward-
snowden-nsa-whistleblower-surveillance. For additional information, see Office of the Director of National
Intelligence, DNI Statement on Recent Unauthorized Disclosures of Classified Information, June 6, 2013,
http://www.dni.gov/index.php/newsroom/press-releases/191-press-releases-2013/868-dni-statement-on-recent-
unauthorized-disclosures-of-classified-information.
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also has an extradition treaty with the United States,11 and a track record of cooperation with the
United States in extradition cases.
Questions going forward include whether the United States will charge Snowden with a crime
and seek his extradition, and if so, whether Beijing will allow the Hong Kong judicial system
alone to handle an extradition request, as would be normal practice, or whether Beijing would
feel the need to intervene on national security grounds. Some U.S. commentators have expressed
concern about the national security implications for the United States of the presence on Chinese
soil of a U.S. citizen allegedly in possession of a large cache of sensitive U.S. government
information. So far, however, the main impact of the reported leaks on U.S.-China relations has
been in the potential undermining of U.S. efforts to hold China to account for alleged cyber-
enabled theft of U.S. intellectual property and other information. A report from China’s state news
agency, Xinhua, claimed that information provided by Snowden had revealed U.S. “hypocrisy”
on the cyber-security issue, and added “a dose of conviction” to China’s denials of state-
sponsored hacking and its claim to be a victim of cyber-crimes.12 An editorial in The Global
Times, a nationalist Chinese tabloid affiliated with China’s leading Communist Party newspaper,
recommended that, “The Chinese government should acquire more solid information from
Snowden if he has it, and use it as evidence to negotiate with the U.S.”13 The Chinese government
has so far declined to comment on the Snowden case.
For more information about Hong Kong’s political system, see CRS Report R42746, Prospects
for Democracy in Hong Kong: Results of the 2012 Elections, by Michael F. Martin.
Obama Administration Policy on China
President Obama signaled soon after taking office that he hoped to work with China to address a
broad range of global issues. 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.”14 At the same time, the Administration has sought to shape the environment in which
China makes strategic choices as a rising power and, through intensive engagement in Asia, to
“give comfort to countries uncertain about the impact of China’s rise and provide important
balance and leadership,” in the words of a former senior Obama Administration official.15 The
latter goals, which form the backbone of much of the Administration’s “rebalance” of foreign
policy priorities to the Asia-Pacific, have been viewed with wariness in Beijing.
To achieve its dual goals, the Administration has seized opportunities for high-level bilateral
meetings with China and added to the existing plethora of bilateral dialogue mechanisms, while at
11 The treaty is the Agreement with Hong Kong for the Surrender of Fugitive Offenders (Treaty No. 105-3), agreed to
in the Senate on October 23, 1997.
12 Liu Dan and Bi Mingxin, “Surveillance Programs Reveal U.S. Hypocrisy,” Xinhua News Agency, June 14, 2013.
13 “China Deserves Explanation of PRISM,” The Global Times, June 14, 2013, http://www.globaltimes.cn/content/
788734.shtml.
14 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.
15 Jeffrey A. Bader, Obama and China’s Rise: An Insider’s Account of America’s Asia Strategy (The Brookings
Institution, 2012), p. 4.
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the same time trying to encourage China to abide by international norms by engaging it in
multilateral fora, sometimes on issues that China considers sensitive. The Administration has also
expanded its public diplomacy, particularly its electronic outreach, in order to engage more
directly with the Chinese public, and overhauled its visa processing services, to facilitate more
travel to the United States by Chinese officials and the Chinese public alike.
The Policy of Strategic Rebalancing to the Asia-Pacific
In the fall of 2011, the Obama Administration announced that with the wars in Iraq and
Afghanistan winding down, the United States was, in President Obama’s words, “turning our
attention to the vast potential of the Asia Pacific region.”16 Then-Secretary of State Hillary
Clinton described economics as a major motivation for the rebalancing, writing that, “Open
markets in Asia provide the United States with unprecedented opportunities for investment, trade,
and access to cutting edge technology,” and arguing that, “Our economic recovery at home will
depend on exports and the ability of American firms to tap into the vast and growing consumer
base in Asia.”17 Another major motivation for the rebalance has been the desire to shape the
development of norms and rules in the Asia-Pacific and, although articulated less explicitly, to
shape China’s choices as a rising power, while offering reassurance to China’s neighbors through
intensive U.S. engagement in the region.
The military component of the Administration’s rebalancing strategy was outlined in a January
2012 Defense Strategic Guidance.18 The Guidance described plans to strengthen U.S. treaty
alliances in the region—with Japan, South Korea, Australia, the Philippines, and Thailand—and
to expand cooperation with “emerging partners” in order to “ensure collective capability and
capacity for securing common interests.” The Guidance also stated that the United States was
“investing in a long-term strategic partnership with India”—a country with which China fought a
war in 1962 and with which China continues to have territorial disputes and a wary relationship—
“to support its ability to serve as a regional economic anchor and provider of security in the
broader Indian Ocean region.” In a paragraph related to China, the document pledged that the
United States would work with its allies and partners “to promote a rules-based international
order that ensures underlying stability and encourages the peaceful rise of new powers, economic
dynamism, and constructive defense cooperation.” Chinese commentators quickly noted that the
document grouped China and Iran together as countries that “will continue to pursue asymmetric
means to counter our power projection capabilities.... ”
Under the rebalancing policy, the Administration has announced a series of moves including new
troop rotations to Australia, naval deployments in Singapore, and military engagements with the
Philippines; stepped up its engagement with regional multilateral institutions; expanded relations
with such “emerging powers” as India, Indonesia, and Vietnam; pursued a new relationship with
Burma; and pushed to expand free trade with Asian nations through the Trans-Pacific Partnership
(TPP). Confirming the Administration’s continued commitment to the rebalancing at the start of
President Obama’s second term, National Security Advisor Thomas Donilon stated in November
2012 that the vision for Asia driving the rebalancing strategy is for a region “where the rise of
16 The White House Office of the Press Secretary, “Remarks by President Obama to the Australian Parliament,” press
release, November 16, 2012.
17 Hillary Clinton, “America’s Pacific Century,” Foreign Policy, November 2011.
18 U.S. Department of Defense, Sustaining U.S. Global Leadership: Priorities for 21st Century Defense, Washington,
DC, January 2012.
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new powers occurs peacefully, [where] the freedom to access the sea, air, space, and cyberspace
empowers vibrant commerce, where multinational forums help promote shared values, and where
citizens increasingly have the ability to influence their governments, and universal human rights
are upheld.... ”19
A common criticism of the rebalancing policy is that it may be unnecessarily antagonizing China
while leading U.S. allies and partners—among them the Philippines, Japan, and Vietnam—to
believe that they have more U.S. support in their disputes with China than the United States is
actually prepared to offer. Those who subscribe to this criticism believe that the rebalancing is
over-focused on military elements and may be eroding already limited U.S.-China strategic trust
and feeding regional instability, rather than minimizing it.20 Other critics suggest that the military
side of the rebalancing may be insufficiently robust, resulting in a U.S. policy that is the
equivalent of “speak loudly and carry a shrinking stick.”21 (For discussion of China’s reaction to
the rebalance, see below, “China’s Reaction to U.S. Strategic Rebalancing To the Asia-Pacific”.)
For more information, see CRS Report R42448, Pivot to the Pacific? The Obama
Administration’s “Rebalancing” Toward Asia, coordinated by Mark E. Manyin.
Forging a “New Model of Cooperation” with China
China has been keen to promote what it calls a “new type of great power relations” with the
United States. In the words of China’s President Xi, “China and the United States must find a new
path—one that is different from the inevitable confrontation and conflict between the major
countries of the past. And that is to say the two sides must work together to build a new model of
major country relationship based on mutual respect and win-win cooperation.”22 The Obama
Administration has accepted the premise of the need to forge a new kind of relationship with
China. As noted above, President Obama embraced the idea explicitly in June 2013, when he
stated that he saw his summit meeting with President Xi as an opportunity to discuss “how we
can forge a new model of cooperation between countries based on mutual interest and mutual
respect.”23 Statements from the Chinese side have made clear, however, just how challenging it
could be to build such a new kind of relationship.
According to China’s top diplomat, State Councilor Yang Jiechi, China believes the new type of
relationship should be based on the principle that the United States and China should “respect
each other’s social system and development road, respect each other’s core interests and
significant concerns, and make common progress through seeking common points while
19 U.S. National Security Adviser Thomas Donilon, President Obama’s Asia Policy and Upcoming Trip to the Region,
Center for Strategic and International Studies (CSIS), November 15, 2012, http://csis.org/files/attachments/
121511_Donilon_Statesmens_Forum_TS.pdf.
20 Robert S. Ross, “Obama’s New Asia Policy Is Unnecessary and Counterproductive,” Foreign Affairs, vol. 91, no. 6
(November/December 2012), pp. 70-82.
21 Bruce Klingner and Dean Cheng, “U.S. Asian Policy: America’s Security Commitment to Asia Needs More Forces,”
The Heritage Foundation, August 7, 2012.
22 The White House Office of the Press Secretary, “Remarks by President Obama and President Xi Jinping of the
People’s Republic of China After Bilateral Meeting,” transcript, June 8, 2013, http://www.whitehouse.gov/the-press-
office/2013/06/08/remarks-president-obama-and-president-xi-jinping-peoples-republic-china-.
23 The White House Office of the Press Secretary, “Remarks by President Obama and President Xi Jinping of the
People’s Republic of China Before Bilateral Meeting,” transcript, June 7, 2013.
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reserving differences.”24 China’s social system and core interests, however, go to the heart of the
differences between the two countries. The demand for respect for China’s “social system,” for
example, challenges the U.S. commitment to democracy promotion and universal human rights.
China’s “core interests,” meanwhile, include maintenance of Communist Party rule and defense
of Chinese sovereignty and territorial integrity. The demand for respect for China’s “core
interests” could thus challenge not just the U.S. commitment to democracy promotion, but also
the U.S. commitment to Taiwan; the U.S. security treaty commitment to ally Japan over islets in
the East China Sea whose sovereignty is disputed among Japan, China, and Taiwan; U.S.
commitments to treaty ally the Philippines, which is involved in territorial disputes with China;
and the U.S. “national interest” in peace and stability, respect for international law, freedom of
navigation, and unimpeded lawful commerce in the South China Sea, where China is involved in
territorial disputes with multiple countries. All these issues are discussed at greater length later in
this report.
Bilateral Engagement
The pace of U.S.-China bilateral interaction at the most senior level has increased dramatically in
recent years. In the 30 years from 1979, the year the United States and China established
diplomatic relations, until the Obama Administration took office in January 2009, the top leaders
of the United States and China met 24 times. In just the first term of the Obama Administration,
President Obama and his then-counterpart, Chinese President Hu Jintao, met 12 times. The
greater frequency of meetings is related in large part to expanded opportunities to meet on the
sidelines of multilateral meetings.25 President Obama visited China in his first year in office, in
2009, and President Hu made a state visit to the United States in January 2011. Their vice
presidents, Joe Biden and Xi Jinping, exchanged visits in 2011 and 2012. As noted above, the first
meeting between President Obama and Xi Jinping since Xi became China’s President in March
2013 took place June 7-8, 2013, in California.
A hallmark of the U.S.-China relationship under the Obama Administration has been the
proliferation of bilateral dialogue mechanisms, building on an already robust set of dialogues
inherited from the George W. Bush Administration. The U.S. government has not published a
comprehensive list, but the Chinese government and state media refer to China and the United
States being involved in “more than 90” bilateral dialogue and consultation mechanisms.26 The
Obama Administration argues that the dialogues allow U.S. and Chinese officials to understand
each other’s positions better on a wide range of issues, a first step to finding areas of common
interest. 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, such as nuclear weapons policy, than the United States and
China do now.
24 Yang Jiechi’s Remarks on the Results of the Presidential Meeting between Xi Jinping and Obama at the Annenberg
Estate, press release, June 9, 2013, http://www.fmprc.gov.cn/eng/zxxx/t1049263.shtml.
25 Once the only multilateral meetings regularly attended by the leaders of both countries were annual meetings of the
United Nations General Assembly and, starting in 1993, Asia Pacific Economic Cooperation (APEC) Leaders’
Meetings. Today, leaders of the two countries also meet at G-20 summits, nuclear security summits, and, as of 2012,
East Asia Summits.
26 “承前启后 引领未来—中美新型大国关系定位的由来,” (“The Past Brings on the Future—How the China-U.S.
New Style Major Power Relationship Came to be Defined”), Xinhua News Agency, November 6, 2012,
http://news.xinhuanet.com/world/2012-11/06/c_123920966.htm.
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The relationship’s highest-profile regularly scheduled dialogue is the annual Strategic and
Economic Dialogue (S&ED), created in 2009 by combining two previously existing dialogues.27
On the U.S. side, the Secretary of State leads the strategic track of the dialogue and the Secretary
of the Treasury leads the economic track. In 2011 the two countries inaugurated a Strategic
Security Dialogue under the S&ED, involving both civilian and military representatives. Other
high-profile dialogues include the U.S.-China Consultation on People-to-People Exchange (CPE),
established in 2010, and three dialogues established before President Obama took office: the Joint
Commission on Commerce and Trade (JCCT), the Ten-Year Framework on Energy and
Environment Cooperation, and the Joint Committee on Environmental Cooperation.28 To broaden
interaction to the sub-national level, the U.S. and Chinese governments in 2011 instituted a U.S.-
China Governors Forum, intended to help deepen relationships between U.S. governors and
Chinese provincial officials,29 and an Initiative on City-Level Economic Cooperation, bringing
together U.S. mayors and Chinese mayors and Party Secretaries.
Multilateral Engagement
As a means of encouraging China to adhere to international norms and “assume responsibilities
commensurate with its growing global impact and its national capabilities,” in the words of
President Obama’s National Security Advisor, Tom Donilon,30 the Obama Administration has
consciously sought to engage with China in multilateral settings. The United States and China are
fellow permanent members of the U.N. Security Council and have worked together successfully
in that setting to pass sanctions targeting North Korea and Iran’s nuclear programs, although
China has also blocked some proposed Security Council actions sought by the United States,
most notably a series of actions related to Syria. The Obama Administration elevated the profile
of the G-20 grouping of major economies in part to have a vibrant multilateral forum for
engaging with China on economic issues. In addition, the United States has sought to resolve
trade disputes with China through the rules-based mechanisms of the World Trade Organization,
and engaged with China on climate change through meetings of parties to the U.N. Framework
Convention on Climate Change. Washington has also urged Beijing to follow norms on aid,
export credit finance, and overseas investment established by the Paris-based Organization for
Economic Cooperation and Development (OECD), although China is not an OECD member, and
to accept principles related to freedom of navigation contained in the United Nations Convention
on the Law of the Sea (UNCLOS), although the United States itself has not ratified the treaty.31
In Asia, the United States has prioritized its own attendance at meetings of regional multilateral
groups, including the East Asia Summit, which the United States joined in 2011, in part to be able
27 The S&ED was created by combining the State Department’s U.S.-China Senior Dialogue (known in China as the
China-U.S. Strategic Dialogue), established in 2005, and the Treasury Department’s Strategic Economic Dialogue,
created in 2006.
28 See JCCT factsheet at http://www.export.gov/china/policyadd/jcct.asp?dName=policyadd.
29 Office of the Spokesperson, Department of State, “U.S.-China Governors Forum Convenes in Utah,” press release,
July 15, 2011, http://www.state.gov/r/pa/prs/ps/2011/07/168613.htm.
30 The White House Office of the Press Secretary, “Remarks by National Security Advisor Tom Donilon—As Prepared
for Delivery: President Obama’s Asia Policy & Upcoming Trip to Asia,” November 15, 2013,
http://www.whitehouse.gov/the-press-office/2012/11/15/remarks-national-security-advisor-tom-donilon-prepared-
delivery.
31 Jeffrey A. Bader, Obama and China’s Rise: An Insider’s Account of America’s Asia Strategy, Brookings Institution
Press, 2012, p. 70.
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to engage China in those settings. The advantage of the multilateral settings of regional
institutions, former Secretary of State Hillary Clinton opined in 2011, is that, “responsible
behavior is rewarded with legitimacy and respect, and we can work together to hold accountable
those who take counterproductive actions to peace, stability, and prosperity.”32
Outreach to the Chinese Public
The U.S. Department of State operates multiple Chinese-language blogs and microblogs on
Chinese platforms in an effort to circumvent often heavy-handed Chinese censorship of the
traditional news media and reach out directly to the Chinese public with messages about U.S.
policy. The Embassy’s flagship microblogs each have well over 650,000 registered followers.33
When followers of U.S. government blogs re-post U.S. blog posts for their own followers, the
U.S. government is sometimes able to reach directly many millions of Chinese who might not
otherwise be exposed to U.S. government messages. That said, although the range of permitted
expression on Chinese social media is broader than in traditional media, China-based microblog
accounts are still subject to Chinese censorship. In July 2012, a Chinese microblog service
disabled a popular microblog operated by the U.S. Consulate General in Shanghai, presumably
because government censors felt uncomfortable with the material the Consulate General was
posting.34
The State Department also operates Chinese-language accounts on the online social networking
service Twitter, which is based in the United States and does not censor content. The U.S.
government posts on Twitter sensitive information that is often censored on Chinese social media,
such as U.S. government speeches related to human rights and Internet freedom. The Chinese
government’s policy of blocking access to Twitter from inside China reduces the service’s reach,
but technologically savvy Chinese are able to use virtual private networks to evade the blocking
technologies. The Chinese-language Twitter account operated by the State Department’s Bureau
of International Information Programs (IIP), @meiguocankao, currently has just over 36,000
followers, a small fraction of the followers of the U.S. Embassy microblogs in China. A second
account operated by the State Department’s Bureau of Public Affairs, @USA_Zhongwen, has just
over 2,000 followers.
Of longer standing are U.S. government efforts to reach out directly to the Chinese public through
programming produced by Radio Free Asia (RFA) and the Voice of America (VOA). Both are
overseen by the Broadcasting Board of Governors (BBG), an independent entity responsible for
all U.S. government and government-sponsored non-military international broadcasting. RFA’s
stated mission is “to provide accurate and timely news and information to Asian countries whose
governments prohibit access to a free press.”35 For audiences in China, it delivers programming in
two Chinese dialects, Mandarin and Cantonese, and in the languages of two ethnic minority
groups, Tibetans and Uyghurs, via shortwave, medium wave, satellite transmissions and the
32 Secretary of State Hillary Rodham Clinton, “A Broad Vision of U.S.-China Relations in the 21st Century,” Inaugural
Richard C. Holbrooke Lecture, Washington, DC, January 14, 2011.
33 When accessed on June 6, 2013, the Embassy’s Sina microblog, http://weibo.com/usembassy, had 683,404 followers,
while the Embassy’s Tencent microblog, http://e.t.qq.com/USEmbassy, had 665,290 followers.
34 William Gallo, “In Shanghai, US Consulate’s Microblog Disappears,” Voice of America, July 13, 2012.
35 Broadcasting Board of Governors, “RFA President Responds to Press Freedom Findings,” press release, May 3,
2012, http://www.bbg.gov/press-release/rfa-president-responds-to-freedom-of-the-press-findings/.
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Internet.36 The Chinese government routinely seeks to block RFA programming from reaching the
Chinese public, has not allowed RFA to open a permanent office in China, and denies RFA
journalists temporary visas to report in China.37
VOA broadcasts in the Chinese dialects of Mandarin and Cantonese and in Tibetan, via shortwave
and satellite. VOA’s mandate is to “present a balanced and comprehensive view of significant
American thought and institutions” and “clearly present the policies of the United States.”38 VOA
has had a permanent office in China since the 1980s, although the Chinese government restricts
the number of accredited journalists VOA is permitted to base in China, allowing only one
reporter for the VOA English-language service, known as Central News, and one reporter for the
Chinese service.39 The Chinese government also routinely seeks to block VOA transmissions.
Through appropriations, Congress has supported the BBG’s efforts to provide Chinese and other
audiences whose home media are subject to censorhip with means of accessing the blocked
websites of BBG broadcasters through proxy servers and other tools.
For more information about the Internet in China, see CRS Report R42601, China, Internet
Freedom, and U.S. Policy, coordinated by Thomas Lum, and CRS Report R41007,
Understanding China’s Political System, by Susan V. Lawrence and Michael F. Martin.
Visa Issuance
In January 2012, President Obama issued an Executive Order requiring the Secretaries of State
and Homeland Security, in consultation with others, to develop a plan to streamline visa and
foreign visitor processing worldwide, “in order to create jobs and spur economic growth in the
United States, while continuing to protect our national security.” The Executive Order, aimed at
supporting the travel and tourism industry, in particular, listed specific targets for the
streamlining. One was to “increase non-immigrant visa processing capacity in China and Brazil
by 40% over the coming year,” and the second was to “ensure that 80 percent of nonimmigrant
visa applicants are interviewed within 3 weeks of receipt of application.”40 Meeting these goals
was a major 2012 focus for the U.S. mission in China, where allegedly cumbersome procedures
for applicants for non-immigrant visas were the subject of complaints from both Chinese and the
U.S. business community.
In response to the President’s Executive Order, the State Department hired new visa adjudicators,
temporarily deployed additional visa officers, expanded consular facilities and visa interview
hours, and launched a two-year pilot program allowing consular staff to waive the in-person
36 Broadcasting Board of Governors, Radio Free Asia, Fact Sheet, http://www.bbg.gov/broadcasters/rfa/.
37 The Heritage Foundation, “H.R. 2899 ‘Chinese Media Reciprocity Act of 2011,’” Testimony before the House
Judiciary Subcommittee on Immigration Enforcement, June 20, 2012, http://judiciary.house.gov/hearings/
Hearings%202012/Zahn%2006202012.pdf. See also John Eggerton, “Radio Free Asia Voice Denied Chinese Visa:
Dhondup Gonzar Has Not Received Entry Permit One Day Before Opening Ceremonies of 2008 Beijing Olympic
Games,” Broadcasting & Cable, August 7, 2008, http://www.broadcastingcable.com/article/97412-
Radio_Free_Asia_Voice_Denied_Chinese_Visa.php.
38 Broadcasting Board of Governors, Voice of America, Fact Sheet, http://www.bbg.gov/broadcasters/voa/.
39 The Heritage Foundation, “H.R. 2899 ‘Chinese Media Reciprocity Act of 2011,’” Testimony before the House
Judiciary Subcommittee on Immigration Enforcement, June 20, 2012.
40 Executive Order 13597, “Establishing Visa and Foreign Visitor Processing Goals and the Task Force on Travel and
Competitiveness,” 77 Federal Register 3473, January 24, 2012, http://www.gpo.gov/fdsys/pkg/FR-2012-01-24/pdf/
2012-1568.pdf.
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interview requirement for certain non-immigrant visa applicants.41 In an August 2012 report to
the White House, the State Department reported that it had succeeded in reducing the average
wait time for a visa interview in China to under 10 days, well below the 50 day average wait time
in June 2011, and within the three week target set in the President’s Executive Order, despite a
large increase in visa applications.42 In FY2012, the U.S. Embassy in Beijing and U.S. consulates
in four other Chinese cities jointly issued 1.2 million non-immigrant visas, an increase of 36%
over FY2011.43 China, Brazil, and Mexico are the only U.S. missions that currently process more
than 1 million non-immigrant visas per year. The Commerce Department has predicted a 198%
increase in Chinese visitors from 2012 levels by 2016.44
Congressional Action Related to China in the 113th
and 112th Congresses
The 113th Congress has so far passed one law with provisions related to China, Consolidated and
Further Continuing Appropriations Act, 2013 (P.L. 113-6). The House has also agreed to a simple
resolution on North Korea (H.Res. 65) that includes provisions related to China. Summaries of all
legislation on China enacted or agreed to in the 113th and 112th Congresses are included as
appendices to this report.
Notable China-related provisions in P.L. 113-6 include
• A requirement that the Department of Commerce provide a monthly report on
any official travel to China by any Department employee, including the purpose
of such travel.
• A prohibition on the Department of Commerce, the Department of Justice, the
National Aeronautics and Space Administration (NASA), and the National
Science Foundation using appropriated funds to acquire information technology
systems without first consulting with the Federal Bureau of Investigation or
another appropriate federal entity and making an assessment of any associated
risk of cyberespionage or sabotage, including any risk associated with the system
being produced, manufactured or assembled by entities owned, directed or
subsidized by the People’s Republic of China.
• A prohibition on the use of appropriated funds by the above agencies to acquire
an information technology system produced, manufactured, or assembled by
41 Department of State and Department of Homeland Security, Executive Order 13597: Improvements to Visa
Processing and Foreign Visitor Processing 180-Day Progress Report, August 2012, http://www.whitehouse.gov/sites/
default/files/docs/eo_13597_180_day_report_final.pdf; Department of State, Progress Report on Improvements to Visa
and Foreign Visitor Processing, Media Note, September 19, 2012, http://www.state.gov/r/pa/prs/ps/2012/09/
197951.htm.
42 Department of State and Department of Homeland Security, Executive Order 13597: Improvements to Visa
Processing and Foreign Visitor Processing 180-Day Progress Report, August 2012.
43 U.S. State Department Bureau of Consular Affairs, Table XIX: Nonimmigrant Visas Issued by Issuing Office
(Including Border Crossing Cards) Fiscal Years 2003-2012, Report of the Visa Office 2012,
http://www.travel.state.gov/pdf/FY12AnnualReport-TableXIX.pdf.
44 Department of State and Department of Homeland Security, Executive Order 13597: Improvements to Visa
Processing and Foreign Visitor Processing 180-Day Progress Report, August 2012.
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entities owned, directed, or subsidized by the PRC unless the entity head
determines that acquisition of such a system is in the national interest of the
United States and reports that determination to the House and Senate Committees
on Appropriations.
• A prohibition of the use of funds made available by the act being used for the
NASA or the White House Office of Science and Technology Policy (OSTP) to
participate, collaborate, or coordinate bilaterally in any way with China or any
Chinese owned company, with certain exceptions.
H.Res. 65 calls on China to
• pressure North Korean leaders to curtail their provocative behavior and abandon
and dismantle their nuclear and missile programs by curtailing vital economic
support and trade to North Korea;
• comply with all relevant international agreements and U.N. Security Council and
International Atomic Energy Agency resolutions; and
• take immediate actions to prevent the transshipment of illicit technology, military
equipment, and dual-use items through its territory, waters, and airspace that
could be used in North Korea’s nuclear weapons and ballistic missile programs.
The 112th Congress passed eight laws with provisions related to China, and also agreed to seven
simple Senate resolutions and one simple House resolution.
Legislative provisions in the eight laws included requirements for the Executive Branch to submit
a number of reports:
• The Commander of the United States Strategic Command: Report on the U.S.
capability to use conventional and nuclear forces to neutralize Chinese nuclear
weapons stored in underground tunnels (P.L. 112-239);
• The Chairman of the Joint Chiefs of Staff: Report on U.S. capabilities in relation
to China, North Korea, and Iran (P.L. 112-239);
• Secretary of Energy: Report certifying that nonproliferation activities with China
are not contributing to proliferation (P.L. 112-239);
• The Secretary of Defense: Report on military and security developments
involving North Korea, including an assessment of North Korean regional
security objectives that affect the PRC (P.L. 112-81); and
• Department of Commerce: Monthly reports on official travel to China by
Department of Commerce employees (P.L. 112-55);
In addition, legislative provisions in P.L. 112-239 and P.L. 112-81 added required elements to the
Department of Defense’s Annual Report on Military and Security Developments Involving the
People’s Republic of China.
Requirements for new executive branch reviews and assessments included:
• Commander of the United States Strategic Command, contracting with a
federally funded research and development center: An assessment of China’s
nuclear weapons program (P.L. 112-239);
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• Secretary of Energy: A review of nonproliferation activities with China to
determine if engagement is directly or indirectly supporting the proliferation of
nuclear weapons development and technology to other nations (P.L. 112-239);
and
• Comptroller General of the United States: A review of “any gaps between
China’s anti-access capabilities and United States’ capabilities to overcome
them” (P.L. 112-81).
Sense of the Congress provisions included:
• that the Secretary of Commerce should insist that China facilitate a meeting
between Chinese drywall companies and representatives of the U.S. government
to discuss remedies for U.S. homeowners with problematic Chinese drywall in
their homes, and insist that China direct Chinese drywall companies to submit to
the jurisdiction of U.S. courts (P.L. 112-266);
• a statement of U.S. policy regarding the Senkaku islets in the East China Sea
over which Japan, the PRC, and Taiwan all claim sovereignty45 (P.L. 112-239);
• That the President should take steps to address Taiwan’s shortfall in fighter
aircraft (P.L. 112-239);
• That children with a North Korean parent may face statelessness in neighboring
countries (China is not named, but implied), and that the Secretary of State
should advocate for their best interests (P.L. 112-264); and
• That the United States should urge China to immediately halt forcible
repatriations of North Koreans and allow the United Nations High Commission
for Refugees unimpeded access to North Koreans inside China (P.L. 112-264).
S
• Funding for the Congressional-Executive Commission on the People’s Republic
of China and the United States-China Economic and Security Review
Commission (P.L. 112-74);
• Direction to the U.S. executive director of each international financial institution
to support projects in Tibet and Tibetan communities in China that meet certain
requirements (P.L. 112-74);
• Direction to the Secretary of State to hire sufficient consular officers to reduce
visa interview wait times in China, Brazil, and India (P.L. 112-74);
• Funding for the Office of China Compliance in the Department of Commerce’s
International Trade Administration and for the ITA’s China Countervailing Duty
Group (P.L. 112-55).
Appropriations legislation barred use of appropriated funds for:
• Processing licenses for the export to China of satellites and satellite components
of U.S. origin (P.L. 112-74);
45 The islets are known in China as the Diaoyu Dao and in Taiwan as the Diaoyutai.
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• Financing any grant, contract, or cooperative agreement with the People’s
Liberation Army or any entity that is controlled by or an affiliate of the PLA (P.L.
112-74);
• United Nations Population Fund country programs in China (P.L. 112-74);
• Any participation, collaboration, or bilateral coordination between the National
Aeronautics and Space Administration (NASA) or the White House Office of
Science and Technology Policy and China or any Chinese-owned company,
except in certain circumstances (P.L. 112-10).
Finally, a legislative provision prohibited the export, re-export, or direct or indirect transfer to
China of satellites or related items subject to the Export Administration Regulations (P.L. 112-
239).
Simple resolutions in the 112th Congress included House and Senate resolutions expressing regret
for the passage of legislation that adversely affected Chinese in the United States, including the
Chinese Exclusion Act of 1882. The Senate passed two resolutions supporting the Tibetan people
and two resolutions related to maritime disputes between China and Southeast Asian states. It also
passed a resolution honoring the late Chinese dissident astrophysicist Fang Lizhi, and a resolution
that expressed disappointment with Russia and China for vetoing a U.N. resolution condemning
Syrian President Bashar al-Assad.
Select Policy Issues
Congress faces challenges in exercising oversight over the United States’ relationship with a
China that is rapidly growing in economic, military, and geopolitical power. Selected policy
issues for Congress related to the bilateral relationship are summarized in the sections below,
starting with security issues and Taiwan, followed by economic issues, climate change and
renewable energy cooperation, and human rights issues.
Security Issues
The U.S.-China Military-to-Military Relationship
In March 2013, President Obama’s National Security Advisor, Tom Donilon, described U.S.-
China military-to-military dialogue as a “critical deficiency” in the current U.S.-China
relationship.46 Congress sought to limit the scope of the military relationship in the National
Defense Authorization Act (NDAA) for Fiscal Year 2000 (P.L. 106-65), when it barred exchanges
or contacts with China’s military, the People’s Liberation Army (PLA), that include
“inappropriate exposure” to a range of subjects, including surveillance and reconnaissance
operations and arms sales.47 The provision remains a major irritant in the bilateral relationship,
46 The White House Office of the Press Secretary, “Remarks By Tom Donilon, National Security Advisor to the
President: The United States and the Asia-Pacific in 2013,” remarks to the Asia Society, March 11, 2013,
http://www.whitehouse.gov/the-press-office/2013/03/11/remarks-tom-donilon-national-security-advisory-president-
united-states-a.
47 The restrictions are contained in Section 1201 of the NDAA for FY2000. They bar military-to-military exchanges or
contacts that include “inappropriate exposure” to 12 operational areas: “1.) Force projection operations; 2.) Nuclear
(continued...)
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with Chinese authorities arguing that it signals U.S. ill will. China’s military, too, has been wary
of a closer relationship with the U.S. military, though, in part because of concern about revealing
potential vulnerabilities of its weaker force.
The Obama Administration, however, has pressed for a stronger military-to-military relationship
with China. Donilon noted in his March 2013 remarks that, “The Chinese military is modernizing
its capabilities and expanding its presence in Asia, drawing our forces into closer contact and
raising the risk that an accident or miscalculation could destabilize the broader relationship.” He
argued that the two countries therefore “need open and reliable channels to address perceptions
and tensions” about their activities and long-term presence in the Western Pacific.48
In the 2011 U.S.-China joint statement issued in the name of the two countries’ presidents,
President Obama and then Chinese President Hu Jintao pledged to pursue “a healthy, stable, and
reliable military-to-military relationship.” The same year, the two countries inaugurated a
Strategic Security Dialogue (SSD) that for the first time brings military and civilian officials from
the two countries together to discuss sensitive issues.49 Efforts to strengthen the military-to-
military relationship seemed to gain momentum as the transition from Hu Jintao to Xi Jinping as
China’s top leader unfolded in 2012 and early 2013. Some analysts believe an unusual visit to the
Pentagon accorded to Xi in February 2012, when he visited the United States as Vice President,
may have helped win his support for stronger ties. The PLA, for its part, has appeared more
willing to follow Xi’s lead than his predecessor’s.
In remarks in Singapore in June 2013, Secretary of Defense Hagel characterized dialogue
between the two militaries as “steadily improving.”50Among the positive developments he cited
were the following:
• Xi’s February 2012 Pentagon visit and visits to China by the chief of the Pacific
Command Navy Adm. Samuel J. Locklear III (July 2012); then-Secretary of
Defense Leon Panetta (September 2012); and Chairman of the Joint Chiefs of
Staff General Martin Dempsey (April 2013);
• China’s first ever participation as an observer of the U.S.-Philippine Balikatan
joint military exercise in April 2013;
• A first-ever U.S.-China joint anti-piracy exercise in the Gulf of Aden in
September 2012;
(...continued)
operations; 3.) Advanced combined-arms and joint combat operations; 4.) Advanced logistical operations; 5.) Chemical
and biological defense and other capabilities related to weapons of mass destruction; 6.) Surveillance and
reconnaissance operations; 7) Joint warfighting experiments and other activities related to a transformation in warfare;
8.) Military space operations; 9.) Other advanced capabilities of the Armed Forces; 10.) Arms sales or military-related
technology transfers; 11.) Release of classified or restricted information; 12.) Access to a Department of Defense
laboratory.”
48 The White House Office of the Press Secretary, “Remarks By Tom Donilon, National Security Advisor to the
President: The United States and the Asia-Pacific in 2013,” remarks to the Asia Society, March 11, 2013,
http://www.whitehouse.gov/the-press-office/2013/03/11/remarks-tom-donilon-national-security-advisory-president-
united-states-a.
49 The first meeting of the Strategic Security Dialogue was held on the sidelines of the May 2011 Strategic and
Economic Dialogue (S&ED) in Washington, DC, and the second on the sidelines of the May 2012 S&ED in Beijing.
50 Department of Defense, “Remarks by Secretary Hagel at the IISS Asia Security Summit, Shangri-La Hotel,
Singapore,” June 1, 2013.
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• A first-ever U.S. invitation to China to participate in the United States’ largest
military exercises in the Pacific, the Rim of the Pacific or RIMPAC exercise, in
the summer of 2014, and China’s reported April 2013 acceptance of the
invitation;
• An agreement for the United States and China to host a Pacific Army Chiefs for
the first time.
In addition, during Chairman of the Joint Chiefs of Staff Martin E. Dempsey’s April 2013 trip to
China, his counterpart offered some of the Chinese military’s strongest language to date accepting
the United States as a Pacific power. “The Asia-Pacific region should be a platform for China-
U.S. cooperation,” General Fang Fenghui, Chief of the PLA General Staff, told reporters. “[W]e
respect the legitimate right and interest of the United States in the Asia-Pacific region and we are
glad to see a constructive role by the United States in the regional affairs.”51 Wariness still
remains strong on both sides, however, with China deeply unnerved by the U.S. policy of
rebalancing to the Asia-Pacific.
For more information, see CRS Report RL32496, U.S.-China Military Contacts: Issues for
Congress, by Shirley A. Kan.
Chinese Military Modernization
The United States has long been concerned about the intentions behind China’s military
modernization. In the January 2012 Defense Strategic Guidance that outlined the military
component of the U.S. rebalancing toward the Asia Pacific, for example, the Department of
Defense (DOD) stated that, “The growth of China’s military power must be accompanied by
greater clarity of its strategic intentions in order to avoid causing friction in the region.”52
In its 2013 report to Congress on military developments involving the PRC, the Department of
Defense (DOD) stated that it believed China’s military modernization is “designed to improve the
capacity of [China’s] armed forces to fight and win short-duration, high-intensity regional
military conflict.”53 DOD assessed that the “principal focus and primary driver of China’s
military investment” is preparing for a contingency involving Taiwan, over which the PRC claims
sovereignty. The DOD report observed, though, that China’s military modernization also appears
increasingly focused on developing capabilities for extended-range power projection and
operations in emerging domains such as cyber, space, and electronic warfare, as well as other
missions, including anti-piracy missions, peacekeeping, humanitarian assistance and disaster
relief, and regional military operations.
Responding to skepticism from the United States and others about its intentions, China has
repeatedly offered assurances that it is committed to “peaceful development” and to working
within the existing international system, not challenging it. Chinese officials have also stated that
China has neither the desire nor the capability to challenge the United States position in Asia. In a
51 Joint Chiefs of Staff, “Gen. Dempsey and Gen. Fang Fenghui’s Joint Presser in Beijing,” press release, April 24,
2013, http://www.jcs.mil/speech.aspx?id=1766.
52 U.S. Department of Defense, Sustaining U.S. Global Leadership: Priorities for 21st Century Defense, Washington,
DC, January 2012.
53 Office of the Secretary of Defense, Annual Report to Congress: Military and Security Developments Involving the
People’s Republic of China 2013, May 7, 2013, http://www.defense.gov/pubs/2013_china_report_final.pdf.
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White Paper released in April 2013, China’s military stated that, “China’s armed forces provide a
security guarantee and strategic support for national development, and make due contributions to
the maintenance of world peace and regional stability.” The White Paper also pledged that “China
will never seek hegemony or behave in a hegemonic manner, nor will it engage in military
expansion.”54 Even as it has sought to reassure, however, China has made clear that it considers
itself to have “core interests” on which it will not compromise. In a 2010 article, China’s top
diplomat at the time listed those interests as maintaining Chinese Communist Party rule;
safeguarding China’s “sovereignty and security, territorial integrity, and national unity”; and
sustaining China’s economic and social development.55
Chinese military modernization has been fueled by two decades of steadily increasing military
spending. According to the DOD report to Congress, China’s officially disclosed military budget
increased an average of 9.7% annually in inflation-adjusted terms over the decade from 2003 to
2012. At $114 billion, China’s officially announced budget for 2013 represents an increase of
10.7% over 2012. The Pentagon believes China’s actual military spending is higher than the
officially disclosed figures, with the report to Congress estimating that China’s military spending
for 2012 was in the range of $135 billion to $215 billion.
Of particular concern to the U.S. government are Chinese capabilities that appear aimed at
allowing China to deter intervention by American forces in a conflict in the Western Pacific. The
United States describes such capabilities as being for “anti-access/area-denial” (A2/AD)
missions; Chinese refers to such missions as “counter-intervention operations.” Among Chinese
weapons programs of concern to the United States is China’s “carrier killer” anti-ship ballistic
missile (ASBM) known as the DF-21D. The Pentagon report described the DF-21D as giving the
PLA “the capability to attack large ships, including aircraft carriers, in the western Pacific
Ocean.” China has also test flown an indigenously produced fifth generation stealth fighter
aircraft prototype, the J-20, and appears to be developing a second advanced stealth aircraft,
tentatively identified as the J-31. The DOD report stated that such planes are intended to
strengthen China’s “ability to strike regional airbases and facilities,” presumably including U.S.
military bases in Asia. The military development that has stirred the greatest national pride in
China is the September 2012 commissioning of China’s first aircraft carrier, although it has so far
provided China with more symbolic than real military power. Acquired from Ukraine in 1998, it
was previously known as the Varyag and is now known as the Liaoning. The DOD report to
Congress predicted that the carrier would reach operational effectiveness “in three to four years”
and that, “China will probably build several aircraft carriers over the next 15 years.”
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.
54 Information Office of the State Council, “Full Text: The Diversified Employment of China’s Armed Forces,” Xinhua
News Agency, April 16, 2013, http://news.xinhuanet.com/english/china/2013-04/16/c_132312681.htm. See also
China’s 2011 White Paper on peaceful development, Information Office of the State Council, China’s Peaceful
Development, September 2011, http://english.gov.cn/official/2011-09/06/content_1941354.htm.
55 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.
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Cyber Activities Directed Against U.S. National Defense Programs
In DOD’s 2013 annual report to Congress on military developments involving China, the U.S.
government for the first time stated that some cyber-intrusions targeting U.S. government and
other computer systems, “appear to be attributable directly to the Chinese government and
military.” The report went on to accuse China of using “computer network exploitation (CNE)”
capabilities to collect intelligence from government and sectors of the U.S. economy that support
U.S. national defense programs. The report did not acknowledge what damage might have been
caused by such intrusions.56 Responding to the allegations in the report, a Chinese Foreign
Ministry spokesperson told reporters, “We resolutely oppose hacking attacks of any form and
stand ready to have calm and constructive dialogue with the U.S. on the cyber security issue.
Unwarranted accusations and hyping will do nothing but undermine our joint efforts for dialogue
and poison the atmosphere.”57
Although DOD has so far accused China only of ex-filtrating information, it has raised concern
about the threat of computer network attacks from China, noting that “the accesses and skills”
required for cyber intrusions are closely related to those needed for attacks.58
For further discussion of cybersecurity in the U.S.-China relationship, see “Commercial Cyber
Espionage” below.
China’s Reaction to U.S. Strategic Rebalancing To the Asia-Pacific
While concerns about cyber security have rapidly emerged as a top concern for the United States
in the U.S.-China relationship, the U.S. strategic rebalance toward the Asia-Pacific is among
China’s top concerns. During a trip to the United States in February 2012, shortly after the policy
was officially launched, President Xi Jinping, then China’s Vice President, responded to the
rebalancing policy with the statement, “China welcomes a constructive role by the United States
in promoting peace, stability and prosperity in the Asia-Pacific. At the same time, we hope the
United States will respect the interests and concerns of China and other countries in this
region.”59 Since then, Chinese officials have repeatedly raised questions about whether the U.S.
56 Office of the Secretary of Defense, Annual Report to Congress: Military and Security Developments Involving the
People’s Republic of China 2013, May 7, 2013, p. 36, http://www.defense.gov/pubs/2013_china_report_final.pdf. A
confidential 2013 Defense Science Board document reportedly alleged, however, that 29 DOD system designs,
including the designs for ballistic missile defense systems, and many other defense technologies had been
“compromised via cyber exploitation.” Officials with knowledge of the breaches told The Washington Post, “the vast
majority [of the exploitations] were part of a widening Chinese campaign of espionage against U.S. defense contractors
and government agencies.” Ellen Nakashima, “Confidential Report Lists U.S. Weapons System Designs Compromised
by Chinese Cyberspies,” Washington Post, May 27, 2013, http://www.washingtonpost.com/world/national-security/
confidential-report-lists-us-weapons-system-designs-compromised-by-chinese-cyberspies/2013/05/27/a42c3e1c-c2dd-
11e2-8c3b-0b5e9247e8ca_story.html.
57 Ministry of Foreign Affairs of the People’s Republic of China, “Foreign Ministry Spokesperson Hua Chunying’s
Regular Press Conference on May 7, 2013,” transcript, May 13, 2013, http://www.fmprc.gov.cn/eng/xwfw/s2510/2511/
t1038551.shtml.
58 Office of the Secretary of Defense, Annual Report to Congress: Military and Security Developments Involving the
People’s Republic of China 2013, May 7, 2013, p. 36, http://www.defense.gov/pubs/2013_china_report_final.pdf.
59 Vice President Xi Jinping, “Remarks by Chinese Vice President Xi Jinping at a Luncheon Co-hosted by the U.S.-
China Business Council and the National Committee on U.S.-China Relations,” Federal News Service, February 15,
2012.
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rebalancing is, in fact, contributing to peace, stability, and prosperity, and whether, despite U.S.
assurances to the contrary, it is in fact intended to “contain” China.
July 2012, China’s Vice Foreign Minister with responsibility for the United States, who is now
China’s Ambassador to the United States, co-authored an article with a fellow diplomat raising
questions about the United States’ “true motive” in rebalancing to the Asia-Pacific and demanding
greater reassurance about U.S. intentions. “The United States must face the issue and convince
China, other countries in the region and the international community that there is no gap between
its policy statements on China and its true intentions,” the diplomats wrote. They identified as
particular areas of concern for China the U.S. effort to strengthen the U.S. alliance system in
Asia, U.S. plans to advance ballistic missile defense in the region, the U.S. “air-sea battle
concept”—an effort to increase the joint operating effectiveness of U.S. naval and air units,
particularly in “anti-access” environments, such as those China has allegedly sought to create—
and alleged U.S. intervention in disputes between China and its neighbors.60
That many in China still do not feel reassured was made plain at a security summit in Singapore
in June 2013, when a senior Chinese PLA scholar told Secretary of Defense Hagel that the
rebalance has been interpreted in China as an “attempt to contain China’s rising influence and to
offset the increasing military capabilities of the Chinese PLA.” U.S. government officials “have
on several occasions clarified that the rebalance is not against China,” she noted. “However,
China is not convinced.” The PLA scholar went on to question Hagel on apparent tensions
between the United States’ stated desire to build a more positive relationship with China, and U.S.
plans to step up military deployments in Asia and reassure U.S. allies.61
The most common charge from Chinese critics is that the United States’ higher profile in Asia,
including its deeper engagement with multilateral groupings such as ASEAN and its
strengthening of its military alliances, is destabilizing the region by emboldening countries with
which China has territorial disputes, including Japan, the Philippines, and Vietnam, to press their
claims more assertively. Chinese commentators have been critical, too, of the flagship economic
initiative of the U.S. rebalancing to Asia, the Trans-Pacific Partnership (TPP).62 The TPP is often
characterized in the Chinese media as an initiative that deliberately excludes China, that is
intended to thwart regional economic integration, and that challenges ASEAN’s leadership role in
promoting trade and investment liberalization in the region. U.S. officials have said that they
welcome China’s participation, although to join, China would need to reform its trade and
investment regimes significantly. At the Obama-Xi summit in June 2013, President Obama agreed
to a request from President Xi for briefings on U.S. progress toward a TPP agreement.63
60 Cui Tiankai and Pang Hanzhao, “China-US Relations in China’s Overall Diplomacy in the New Era—On China and
US Working Together to Build a New-Type Relationship Between Major Countries,” China International Strategy
Review 2012, July 20, 2012, http://www.fmprc.gov.cn/eng/zxxx/t953682.htm
61 The PLA scholar was Major Gen. Yao Yunzhu, Director of the Center for China-America Defense Relations at the
PLA’s Academy of Military Sciences. Department of Defense, “Remarks by Secretary Hagel at the IISS Asia Security
Summit, Shangri-La Hotel, Singapore,” June 1, 2013, http://www.defense.gov/transcripts/transcript.aspx?transcriptid=
5251.
62 As discussed in other parts of this memorandum, formal U.S. participation in the proposed TPP was initiated under
the Bush Administration. Subsequently, it has become an important part of the Obama Administration’s rebalancing
toward the Asia-Pacific.
63 The White House Office of the Press Secretary, “Press Briefing by National Security Advisor Tom Donilon,”
transcript, June 8, 2013, http://www.whitehouse.gov/the-press-office/2013/06/09/press-briefing-national-security-
advisor-tom-donilon.
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For more information, see CRS Report R42448, Pivot to the Pacific? The Obama
Administration’s “Rebalancing” Toward Asia, coordinated by Mark E. Manyin.
Maritime Territorial Disputes
China has long placed a high priority on sovereignty and territorial integrity, a priority reflected in
its decades-long effort to bring Taiwan under its control. The same priority has propelled China
into a series of disputes with its neighbors over maritime territory in the South China Sea and
East China Sea. Beijing’s increasing willingness to bring its maritime power and growing
economic clout to bear on those disputes has raised concerns in Asia and among policymakers in
the United States about whether China’s continued rise will be as peaceful as China has long
promised. Two of China’s rival claimants, Japan and the Philippines, are U.S. allies. The United
States has specifically acknowledged that the U.S. security treaty with Japan covers all areas
under Japanese administration, including islands that are currently at the center of a territorial
dispute between Japan and China.
For more information, see CRS Report R42930, Maritime Territorial Disputes in East Asia:
Issues for Congress, by Ben Dolven, Shirley A. Kan, and Mark E. Manyin and CRS Report
R42784, Maritime Territorial and Exclusive Economic Zone (EEZ) Disputes Involving China:
Issues for Congress, by Ronald O'Rourke.
South China Sea
Tensions among rival claimants to territory in the South China Sea (SCS) have emerged as a
major U.S. security concern in the Asia Pacific. China has extensive, though imprecise, claims to
large parts of the SCS, which is believed to be rich in oil and gas deposits as well as fisheries, and
through which a major portion of world’s trade passes. Territory claimed by China is also claimed
in part by Brunei, Malaysia, the Philippines, and Vietnam, and in entirety by Taiwan, with the
fiercest territorial disputes being those between China and Vietnam and China and the
Philippines. The SCS is bordered by a U.S. treaty ally, the Philippines, and is a key strategic
waterway for the U.S. Navy.
In July 2010, then Secretary of State Hillary Clinton explicitly declared a U.S. “national interest”
in maintaining freedom of navigation in the SCS. An August 2012 State Department statement
further defined that national interest as being in “the maintenance of peace and stability, respect
for international law, freedom of navigation, and unimpeded lawful commerce” in the sea. The
statement noted that United States does not take a position on the competing sovereignty claims,
but believes that, “the nations of the region should work collaboratively and diplomatically to
resolve disputes without coercion, without intimidation, without threats, and without the use of
force.”64 China’s Foreign Minister declared Secretary Clinton’s comments to have been “in effect
an attack on China.”65
64 U.S. Department of State, “Patrick Ventrell, Acting Deputy Spokesperson, Office of Press Relations: Statement on
the South China Sea,” August 3, 2012, http://www.state.gov/r/pa/prs/ps/2012/08/196022.htm.
65 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.
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The territorial disputes at the heart of the tensions are decades, or even centuries, old, but
observers have noted a sharp uptick in incidents at sea since 2005-2006, from claimants seeking
to assert sovereignty or exploit offshore hydrocarbons and fishery resources. A major incident
occurred in 2012 at Scarborough Shoal, known in China as Huangyan Dao, a set of landmasses
disputed between China and the Philippines. Chinese vessels confronted a Philippine Naval
vessel that had interdicted Chinese fishing boats. After a weeks-long standoff, Philippine vessels
left the area, leaving China in control of an area it had not previously held. This development was
among several that prompted the August 2012 State Department statement opposing coercion,
threats and the use of force. China and the Philippines have been facing off since May 2013 over
a remote coral reef, the Second Thomas Shoal, known in China as Ren’ai Reef.
The United States has supported efforts by China’s rival claimants to place the issue of the
tensions in the South China Sea on the discussion agenda for regional meetings. China, which
argues that the disputes are best handled among the rival claimants alone, has resisted what it
calls U.S. efforts to “internationalize” the disputes. The United States has also publicly urged the
Association of Southeast Asian Nations (ASEAN) and China to move forward with long-stalled
negotiations over the text of a binding code of conduct that would govern behavior in the SCS,
and would include specific dispute-resolution mechanisms. Although China had earlier
pronounced that the time was not right for Code of Conduct negotiations, Chinese Foreign
Minister Wang Yi told his Indonesian counterpart in May 2013 that China was ready to re-start
such negotiations.66
East China Sea
In the East China Sea, China is involved in a territorial dispute with Japan over the sovereignty of
uninhabited islets known in Japan as the Senkakus and in China as the Diaoyu Dao. The islets are
also claimed by Taiwan, which refers to them as the Diaoyutai. The United States does not take a
position on the sovereignty dispute, but has a strong interest in the issue because the U.S.-Japan
Treaty of Mutual Cooperation and Security covers areas under Japanese administration, and the
United States government has repeatedly confirmed that such areas include the Senkakus/Diaoyu
Islets.
Japan-China tensions over the islets have run high since September 11, 2012, when Japan’s
government purchased three of the islands from their private Japanese owners, a move that China
charged was equivalent to “nationalizing” the islands. Since then, China has maintained a nearly
continuous presence near the islets and repeatedly sent its vessels into the 12 nautical mile
territorial waters around them. China has mainly deployed vessels from the two civilian agencies,
China Maritime Surveillance and the Bureau of Fisheries, but it has also sent Navy vessels and
military aircraft into the area near the islands. Japan has responded with stepped-up coast guard
patrols and missions by Japanese Self Defense Force fighter planes.
Chinese officials have indicated that among their immediate goals is to force Japan to
acknowledge that sovereignty of the islets is in dispute, an acknowledgement that Japan has
66 Bagus BT Saragih, “China Closer to South China Sea Code of Conduct, Marty says,” The Jakarta Post, May 3, 2013,
http://www.thejakartapost.com/news/2013/05/03/china-closer-south-china-sea-code-conduct-marty-says.html; and
Ministry of Foreign Affairs of the People’s Republic of China, “Wang Yi: Keeping Vigilant Against Some Countries
Stirring Up Troubles in South China Sea for Their Own Interests,” press release, May 2, 2013,
http://www.fmprc.gov.cn/eng/zxxx/t1037682.shtml.
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resisted. Some observers believe that China may also have hoped to undermine the case for
possible U.S. intervention in a conflict over the islets by arguing that the Chinese presence near
the islands proves the islets are no longer administered solely by Japan, and thus may not fall
within the scope of the U.S.-Japan security treaty. Congress sought to address that line of
argument in Section 1286 of the FY2013 National Defense Authorization Act (P.L. 112-239). The
section stated that it was the sense of Congress that “the unilateral action of a third party”—a
reference to China—“will not affect the United States’ acknowledgement” of Japanese
administration over the islands. The section also reaffirmed the United States commitment to
Japan under Article V of the security treaty. Then-Secretary of State Hillary Clinton adopted the
same position in remarks in January 2013,67 as did Secretary of Defense Chuck Hagel in remarks
in April 2013.68 A Chinese Foreign Ministry spokesman denounced Clinton’s statement as
“ignorant of facts and indiscriminate of rights and wrongs.”69 After the Obama-Xi summit in June
2013, National Security Advisor Donilon paraphrased President Obama as telling his Chinese
counterpart that the United States does not take a position on the sovereignty of the disputed
islets, but “the parties should seek to de-escalate, not escalate; and the parties should seek to have
conversations about this through diplomatic channels and not through actions out of the East
China Sea.”70
The China-Japan dispute over the Senkakus/Diaoyu previously rose to the level of an
international crisis in September 2010, after a collision between Japanese Coast Guard vessels
and a Chinese fishing trawler near the islands, and the Japanese decision to detain the Chinese
crew and charge the Chinese captain under Japanese law.
For more information, see CRS Report R42761, Senkaku (Diaoyu/Diaoyutai) Islands Dispute:
U.S. Treaty Obligations, by Mark E. Manyin and CRS Report RL33436, Japan-U.S. Relations:
Issues for Congress, coordinated by Emma Chanlett-Avery.
Exclusive Economic Zone (EEZ) Disputes
The issue that has for years provided the greatest day-to-day threat of inadvertent military
confrontation between the United States and China is disagreement over whether the United
Nations Convention on the Law of the Sea (UNCLOS)—a treaty to which China but not the
United States is a party—gives coastal states a right to regulate foreign military activities in their
maritime exclusive economic zones (EEZs). A coastal state’s EEZ generally extends from the
edge of its territorial sea (12 nautical miles from its coast) to a distance of 200 nautical miles from
67 Clinton stated that, “... although the United States does not take a position on the ultimate sovereignty of the islands,
we acknowledge they are under the administration of Japan and we oppose any unilateral actions that would seek to
undermine Japanese administration.... ” Department of State, “Secretary of State Hillary Rodham Clinton Remarks with
Japanese Foreign Minister Fumio Kishida After Their Meeting,” January 18, 2013, http://www.state.gov/secretary/rm/
2013/01/203050.htm.
68 Hagel stated that, “... the United States opposes any unilateral or coercive action that seeks to undermine Japan’s
administrative control.... ” He added, “The United States does not take a position on the ultimate sovereignty of the
islands, but we do recognize they are under the administration of Japan and fall under our security treaty obligations.”
Department of Defense, “Press Conference with Secretary Hagel and Defense Minister Onodera from the Pentagon,”
April 29, 2013, http://www.defense.gov/transcripts/transcript.aspx?transcriptid=5230.
69 “China Opposes U.S. Comments About Diaoyu Islands: Spokesman,” Xinhua News Agency, January 20, 2013.
70 The White House Office of the Press Secretary, “Press Briefing by National Security Advisor Tom Donilon,”
transcript, June 8, 2013, http://www.whitehouse.gov/the-press-office/2013/06/09/press-briefing-national-security-
advisor-tom-donilon.
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its coast. China’s view, which is shared by a small number of other countries, has been that it has
the legal right under UNCLOS to regulate foreign military activities in its EEZ. The U.S. view,
which is shared by most other nations, is that international law as reflected in UNCLOS does not
give coastal states this right.
The United States, acting on its view, has long operated military ships and aircraft in China’s
EEZ, carrying out 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, acting on its view, has long protested,
and sometimes physically resisted, these operations. The issue appears to be at the heart of
multiple incidents between Chinese and U.S. ships and aircraft in international waters and
airspace, including incidents in March 2001, March 2009, and May 2009 in which Chinese ships
and aircraft confronted and harassed the U.S. naval ships as they were conducting survey and
ocean surveillance operations in China’s EEZ, and an incident on April 1, 2001, in which a U.S.
Navy EP-3 electronic surveillance aircraft flying in international airspace about 65 miles
southeast of China’s Hainan Island in the South China Sea was intercepted by Chinese fighters.71
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.72
Revelations in 2013 have raised questions about whether the Chinese position may be changing,
however. DOD’s 2013 report to Congress on military developments involving China noted that
the United States had “observed over the past year several instances of Chinese naval activities in
the EEZ around Guam and Hawaii.” The DOD report observed that the United States considers
such activities to be “lawful,” but noted that “the activity undercuts China’s decades-old position
that similar foreign military activities in China’s EEZ are unlawful.”73 In June 2013, a PLA
officer attending a security dialogue in Singapore reportedly publicly acknowledged that China
has sent vessels into the United States’ EEZ “a few times.”74
For more information, see CRS Report R42784, Maritime Territorial and Exclusive Economic
Zone (EEZ) Disputes Involving China: Issues for Congress, by Ronald O'Rourke.
71 One of the fighters accidentally collided with and damaged the EP-3, which then made an emergency landing on
Hainan Island. For more on this incident, see CRS Report RL30946, China-U.S. Aircraft Collision Incident of April
2001: Assessments and Policy Implications, by Shirley A. Kan et al.
72 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.
73 Office of the Secretary of Defense, Annual Report to Congress: Military and Security Developments Involving the
People’s Republic of China 2013, May 7, 2013, http://www.defense.gov/pubs/2013_china_report_final.pdf.
74 The Chinese military officer was Senior Colonel Zhou Bo. See Jeff M. Smith, China Comes Around?, Pacific
Forum—CSIS, PacNet #41, June 11, 2013, http://csis.org/publication/pacnet-41-china-comes-around.Rory Medcalf,
“Maritime Game Changer Revealed at Shangri-la Dialogue,” The Diplomat, June 2, 2013.
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Managing North Korea
The United States and China share a common interest in peace and stability on the Korean
peninsula and in verifiable denuclearization of the peninsula. With China serving as North
Korea’s largest supplier of fuel and food supplies and its most powerful diplomatic ally, however,
the United States continues to call on China to do more to leverage its relationship with
Pyongyang to persuade it to avoid provocations and denuclearize. Washington also wants Beijing
to strengthen its implementation of U.N. sanctions against North Korea. “We believe that no
country, including China, should conduct ‘business as usual’ with a North Korea that threatens its
neighbors,” National Security Advisor Tom Donilon remarked in a speech on Asia policy in
March 2013.75
Over the years, China has supported some U.N. actions against North Korea, and shielded North
Korea from others. In 2013, it has supported two resolutions targeting North Korea, January’s
Resolution 2087 condemning the country’s December 2012 rocket launch, and March’s
Resolution 2094, which strengthened existing sanctions against North Korea in response to the
country’s February 2013 nuclear test.76 A year earlier, in April 2012, China supported a U.N.
Security Council Presidential statement—but not a binding resolution—that “strongly
condemned” North Korea and imposed limited new sanctions on it for a failed ballistic missile
test that Pyongyang described as a satellite launch.77 China also supported U.N. Resolution 1718
(2006), condemning North Korea for its first nuclear test and imposing limited sanctions, and
U.N. Resolution 1874 (2009), condemning North Korea’s second nuclear test and imposing
expanded sanctions, although U.S. officials say that China has taken a minimalist approach to
enforcing those sanctions.78
In the opposite vein, in 2010, China worked at the United Nations to shield North Korea from
condemnation for the March 2010 sinking of a South Korean naval vessel, the Cheonan; the
November 2010 revelation that North Korea had built a sophisticated uranium enrichment
facility; and North Korea’s November 2010 shelling of South Korea’s Yellow Sea island of
Yeonpyeong.
Since the death of former North Korean leader Kim Jong-il in December 2011 and the installation
of his son, Kim Jong-un, as North Korea’s supreme leader, Chinese-North Korean relations have
frequently appeared strained. North Korea repeatedly ignored China’s warnings not to carry out
the rocket launches and the nuclear test, and in May 2012 North Korea stirred angry populist
passions in China when its Navy boarded a Chinese fishing boat and held the crew for more than
two weeks.79 China has long been committed to providing material support to the Pyongyang
75 The White House Office of the Press Secretary, “Remarks By Tom Donilon, National Security Advisor to the
President: The United States and the Asia-Pacific in 2013,” remarks to the Asia Society, March 11, 2013,
http://www.whitehouse.gov/the-press-office/2013/03/11/remarks-tom-donilon-national-security-advisory-president-
united-states-a.
76 United Nations News Service, Security Council Tightens Sanctions on DPR Korea in Wake of Latest Nuclear Blast,
March 7, 2013, http://www.un.org/apps/news/story.asp?NewsID=44313&Cr=democratic&Cr1=korea.
77 United States Mission to the United Nations, “Fact Sheet: UN Security Council Presidential Statement on North
Korea Launch,” press release, April 16, 2012, http://usun.state.gov/briefing/statements/187937.htm.
78 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.
79 Jane Perlez, “North Korea Tests the Patience of Its Closest Ally,” New York Times, June 24, 2012.
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regime because of fears about the potentially destabilizing consequences of the regime’s collapse,
which could include military hostilities, waves of North Korean refugees flooding into China’s
northeast provinces, and a reunified Korean peninsula allied with the United States. In recent
months, however, Chinese scholars have reported a vigorous debate within China about North
Korea policy, and China’s leaders have appeared modestly more willing to pressure North Korea,
perhaps accepting that it is the status quo that has become destabilizing.
At the Bo’ao Forum in April 2013, shortly after he took office as China’s President, Xi Jinping
raised eyebrows among observers of the China-North Korea relations when he warned that, “No
one should be allowed to throw a region or even the whole world into chaos for selfish gain.”80
The comment was widely interpreted to be directed at Pyongyang. In May 2013, a major Chinese
state bank, Bank of China, announced that it had closed the account of North Korea’s primary
foreign-exchange bank, the Foreign Trade Bank.81
China’s treatment of North Korean refugees has been an issue of concern for Congress. China
considers North Koreans who have fled their homeland to China to be economic migrants, rather
than refugees, and continues to resist allowing the United Nations High Commissioner on
Refugees access to them. China’s official policy is to repatriate the refugees 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 substantial numbers of
North Korean refugees continue to live underground in China.
For more information, see “June 7-8, 2013: The Presidential Summit in Rancho Mirage, CA”
above. See also CRS Report R41259, North Korea: U.S. Relations, Nuclear Diplomacy, and
Internal Situation, by Emma Chanlett-Avery and Ian E. Rinehart; 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.
Curbing Iran’s Nuclear Program
Since 2006, China has been an important player in U.S.- and European-led multilateral efforts to
rein in Iran’s suspected nuclear weapons program. As a permanent member of the U.N. Security
Council, China has participated in negotiations with Iran over the nuclear program as part of the
P5+1 grouping (permanent members of the United Nations Security Council plus Germany). It
has also supported a series of 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 and joined Russia in pushing 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,
80 The White House Office of the Press Secretary, “Remarks By Tom Donilon, National Security Advisor to the
President: The United States and the Asia-Pacific in 2013,” remarks to the Asia Society, March 11, 2013,
http://www.whitehouse.gov/the-press-office/2013/03/11/remarks-tom-donilon-national-security-advisory-president-
united-states-a.
81 Heng Xie and Megha Rajagopalan, “Bank of China Closes Account of Key North Korean Bank,” Reuters, May 7,
2013.
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Russia and China successfully insisted that new sanctions not target Iran’s civilian economy or its
population.
China’s policy toward Iran is also of crucial importance to U.S. efforts to pressure the Iranian
regime because China is Iran’s largest trading partner and single largest customer for oil, and a
major investor in the Iranian energy and other sectors. 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. It did substantially
decrease its oil imports from Iran in 2012, though, reportedly in part because of disputes with Iran
over the terms of annual purchase contracts.82
The Administration granted China P.L. 112-81 sanctions exemptions on June 28, 2012, December
7, 2012, and June 5, 2013. At the same time, the United States has also sanctioned Chinese
businesses for their involvement in Iran. In July 2012, for example, the Administration sanctioned
the Xinjiang-based Bank of Kunlun, which is affiliated with the China National Petroleum
Corporation, “for knowingly facilitating significant transactions and providing significant
financial services for designated Iranian banks.”83 China angrily protested the move and defended
China’s business ties with Iran. A Chinese Foreign Ministry spokesman insisted that China’s
cooperation with Iran, “has nothing to do with Iran’s nuclear program, is not in violation of any
U.N. Security Council resolutions or other international norms, and does not harm the interests of
any third party.”84
U.S. officials give China credit for not moving to take over contracts given up by other countries,
a behavior that the United States refers to as “backfilling.” In March 2011, Robert Einhorn, then
the State Department’s Special Advisor for Nonproliferation and Arms Control, cited “substantial
evidence that Beijing has taken a cautious, go-slow approach toward its energy cooperation with
Iran.”85
The United States has for many years implicated Chinese firms in sales to Iran of missile
technology. The Central Intelligence Agency’s 2012 report to Congress on the Acquisition of
Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions,
covering the 2011 calendar year, stated that, “Chinese entities—primarily private companies and
individuals—continue to supply a variety of missile-related items to multiple customers,
including Iran and Pakistan.”86
82 U.S. Energy Information Administration, Iran, March 28, 2013, http://www.eia.gov/countries/cab.cfm?fips=ir.
83 U.S. Department of the Treasury, “Treasury Sanctions Kunlun Bank in China and Elaf Bank in Iraq for Business
with Designated Iranian Banks,” press release, July 31, 2012, http://www.treasury.gov/press-center/press-releases/
Pages/tg1661.aspx.
84 Ministry of Foreign Affairs of the People’s Republic of China, “Foreign Ministry Spokesperson Qin Gang’s Remarks
on US Sanctions against Bank of Kunlun,” August 1, 2012, http://www.fmprc.gov.cn/eng/.
85 State Department Special Advisor for Nonproliferation and Arms Control Robert Einhorn, “The Impact of Sanctions
on Iran’s Nuclear Program,” Remarks to Arms Control Association Briefing Series, Washington, DC, March 9, 2011,
http://www.armscontrol.org/events/RoleSanctionsIranNuclear.
86 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
2011, February 2012, p. 8, http://www.fas.org/irp/threat/wmd-acq2011.pdf.
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For more information, see CRS Report RS20871, Iran Sanctions, by Kenneth Katzman; and CRS
Report RL31555, China and Proliferation of Weapons of Mass Destruction and Missiles: Policy
Issues, by Shirley A. Kan.
Resolving the Crisis in Syria
The United States has looked to China, a fellow permanent member of the United Nations
Security Council, to play a constructive role in helping to resolve the crisis in Syria. China has
opposed all military intervention in Syria, including proposals for U.N. authorization of use of
force, and has joined Russia in blocking several U.S.-backed Security Council resolutions on
Syria. China’s position is that “a political solution is the only realistic way to address the Syria
issue.” China’s Foreign Ministry has urged efforts to bring about a ceasefire and launch a
transition process in accordance with the communique from the Geneva foreign ministers
meeting. It has pledged that China will take “an active part” in the international conference on
Syria proposed in late May by U.S. Secretary of State Kerry and his Russian counterpart, and has
supported participation by Iran and Saudi Arabia in the proposed conference.87
Taiwan
The U.S. relationship with the island democracy of Taiwan, also known as the Republic of China,
is one of the most sensitive and complex issues in the bilateral U.S.-China relationship. In 1949,
following a civil war between the Kuomintang (KMT) and the Chinese Communist Party (CCP)
that brought the CCP to power in mainland China, the KMT re-established itself on Taiwan. The
PRC has consistently claimed sovereignty over Taiwan in the six decades since, but has never
controlled it. Unification with Taiwan and its 23 million people remains one of the PRC’s most
cherished national goals, one Beijing has vowed to achieve by force if necessary. Beijing sees the
United States, which is required by law to “maintain the capacity …to resist any resort to force or
other forms of coercion” against Taiwan, as a major obstacle to that goal.
Finding language on Taiwan that both the PRC and the United States could accept was a
prerequisite for the establishment of diplomatic relations between the two countries in 1979. In
the 1972 Shanghai Communiqué, 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.” In the 1979 communiqué on the establishment of U.S.-China diplomatic relations,
the United States agreed that it would henceforth have only “unofficial” relations with Taiwan. In
a subsequent 1982 communiqué, the United States said it intended “gradually to reduce its sale of
arms to Taiwan.”
Concerned that the Joint Communiqués did not do enough to protect Taiwan’s interests, Congress
in March 1979 passed the Taiwan Relations Act or TRA (P.L. 96-8). The TRA declared that it is
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.” The TRA also mandated that the United States would sell Taiwan defense
items “in such quantity as may be necessary to enable Taiwan to maintain a sufficient self-defense
capability.” Washington continues to sell arms to Taiwan, over strenuous PRC objections, and
87 Ministry of Foreign Affairs of the People’s Republic of China, Press conferences hosted by Foreign Ministry
Spokesperson Hong Lei on May 21, May 23, and May 27, 2013.
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Washington and Beijing continue to plan for the possibility that they could one day find
themselves involved in a military confrontation over Taiwan’s fate.
Despite reduced cross-strait tensions since 2008, when President Ma Ying-jeou of the KMT took
office, the Department of Defense estimates that the PRC deploys more than 1,100 short-range
ballistic missiles opposite Taiwan’s coast. China has also engaged in a program of military
modernization that includes the development or deployment of military capabilities “to coerce
Taiwan or attempt an invasion, if necessary,” according to DOD.88
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 in 1998 publicly stated that the United States does not support Taiwan’s membership
in any international organizations for which statehood is a requirement.89
An additional factor influencing U.S. policy is the fact that Taiwan has blossomed into a vibrant
and unpredictable democracy. As Taiwan’s elected leaders have sought to define Taiwan’s place
in the world and expand its “international space,” the United States has sometimes found itself
urging restraint, opening Washington to charges that it is placing its interest in regional stability
and cooperative relations with Beijing above the aspirations of the Taiwan people. Supporters of
Taiwan’s largest opposition party, the independence-minded Democratic Progressive Party (DPP),
charged that in the run-up to January 2012 presidential and legislative elections, the United States
inappropriately signaled its support for President Ma’s candidacy because of a fear of heightened
tensions between Taipei and Beijing if the DPP candidate were to win.90 President Ma was re-
elected to a second four-year term, which is scheduled to conclude in May 2016.
For more information, see CRS Report R41952, U.S.-Taiwan Relationship: Overview of Policy
Issues, by Shirley A. Kan and Wayne M. Morrison; CRS Report R41263, Democratic Reforms in
Taiwan: Issues for Congress, by Shirley A. Kan; and CRS Report RL30341, China/Taiwan:
Evolution of the “One China” Policy—Key Statements from Washington, Beijing, and Taipei, by
Shirley A. Kan.
88 Office of the Secretary of Defense, Annual Report to Congress: Military and Security Developments Involving the
People’s Republic of China 2013, May 7, 2013, pp. 5, 55, http://www.defense.gov/pubs/2013_china_report_final.pdf.
89 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.”
90 While the DPP candidate Tsai Ying-wen was visiting Washington, DC, an unnamed senior Administration official
told the Financial Times that Tsai “left us with distinct doubts about whether she is both willing and able to continue
the stability in cross-Strait relations the region has enjoyed in recent years.” Anna Fifield, “U.S. Concerned About
Taiwan Presidential Candidate,” Financial Times, September 15, 2011. In the closing months of the campaign the
Administration also dispatched two high level officials to visit Taiwan and officially nominated Taiwan to the
Department of Homeland Security’s visa waiver program, a major goal of the Ma Administration.
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The Three Joint Communiqués, the Taiwan Relations Act, and the Six Assurances
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. In addition, in 1982, during negotiations over
the third U.S.-China joint communiqué, the United States oral y conveyed “Six Assurances” to the government of
Taiwan. The documents and oral commitments 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.91
•
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
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.”
•
“The Six Assurances,” conveyed by the Reagan Administration to Taiwan in 1982, during the negotiations
between Washington and Beijing over the August 17th Communiqué. They were that the United States had not
set a date for ending arms sales to Taiwan; had not agreed to consult with Beijing prior to making arms sales to
Taiwan; would not play a mediation role between Taipei and Beijing; had not agreed to revise the Taiwan
Relations Act; had not altered its position regarding sovereignty of Taiwan; and would not exert pressure on
Taiwan to negotiate with the PRC.92
Cross-Strait Relations
Tensions between Beijing and Taipei have eased since President Ma first took office in Taiwan in
2008, following 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.
91 The United States withdrew all military personnel from Taiwan in 1979, during the Carter Administration.
92 Different sources give slightly differing versions of the language of the “Six Assurances.” See CRS Report RL30341,
China/Taiwan: Evolution of the “One China” Policy—Key Statements from Washington, Beijing, and Taipei, by
Shirley A. Kan.
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Other rounds produced accords related to postal links, food safety, and Chinese investment in
Taiwan.93
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 under
the name “Chinese Taipei.”94 The invitation, issued with China’s assent, marked the first time that
Taiwan had been permitted to participate in an activity of a U.N. specialized agency since it lost
its U.N. seat to China in 1971. Some analysts have questioned how much Taiwan gained,
however, noting that China has a memorandum of understanding with the WHO requiring that
any interaction between Taiwan and the WHO be approved first by the Chinese Ministry of
Health, and noting, too, that in WHO documents, Taiwan is referred to as “Taiwan Province of
China.”95
Taiwan is now seeking observer status in a second international body long closed to it, the
International Civil Aviation Organization (ICAO). In a September 2012 meeting between then
Chinese President Hu Jintao and Lien Chan, Honorary Chairman of Taiwan’s KMT, Hu pledged
that Beijing would, in the KMT’s words, “seriously study how to allow Taiwan to participate in
ICAO events in an appropriate way.”96 Hu is now retired, but Beijing still appears to consider
itself bound by Hu’s words. It has not sought to block Taiwan’s bid for observer status in the
ICAO, but has made clear that it expects to be heavily involved in negotiating the terms of any
Taiwan participation.
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.97 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, some analysts believe that closer economic ties
may deter cross-straits conflict by increasing the potential economic and human costs for both
sides. In the joint statement issued during Chinese President Hu Jintao’s state visit to Washington
in January 2011, the United States said that it “applauded” the ECFA and “welcomed the new
lines of communication developing between” the two sides of the Taiwan Strait. Concerned about
losing trade competitiveness in Asia to China, Japan, and South Korea as the three nations
negotiate a regional free trade accord, Taiwan’s Straits Exchange Foundation (SEF) announced in
May 2012 that it would strive to complete the ECFA negotiations by the end of 2013.98
93 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).
94 Low, Y.F., “CNA: World Health Assembly’s Invitation Raises Taiwan’s International Profile,” Taipei Central News
Agency, April 29, 2009.
95 For discussion of Taiwan’s participation in international organizations and its observer status in the World Health
Association, see Sigrid Winkler, “Taiwan’s UN Dilemma: To Be or Not To Be,” June 2012, Brookings Institution
website, http://www.brookings.edu/research/opinions/2012/06/20-taiwan-un-winkler.
96 Kuomintang Official Website, “Lien Chan: Cross-StraitEconomic and Trade Relations Enter Deep Waters,” press
release, September 10, 2013, http://www.kmt.org.tw/english/page.aspx?type=article&mnum=112&anum=11835.
97 Cross-Straits trade in 2010 amounted to roughly $152 billion, making the PRC Taiwan’s largest trading partner; see
U.S. Congress, House Committee on Foreign Affairs, Testimony of Dr. Kurt M. Campbell, 112th Cong., October 4,
2011, http://www.state.gov/p/eap/rls/rm/2011/10/174980.htm.
98 Want China Times, ECFA talks key to raising Taiwan’s economic strength: SEF, May 17, 2012,
(continued...)
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U.S. Arms Sales to Taiwan
The issue of U.S. arms sales to Taiwan is among the most contentious in the U.S.-China
relationship. 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.99 China also charges that continued U.S. arms sales 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.” The U.S. government argues that arms sales to Taiwan give Taiwan’s leaders the
confidence and “capacity to resist intimidation and coercion” required to engage with China.100
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 October 2011, the Obama Administration notified Congress of a $5.85 billion arms package,
including upgrades to 145 F-16A/B fighter jets, the extension of a pilot training program, and
spare parts for three types of aircraft. Although China has previously suspended the military-to-
military relationship with the United States to protest U.S. arms sales packages to Taiwan, it did
not do so in this case, perhaps because the Obama Administration chose not to sell Taiwan more
advanced F-16C/D fighters. China strenuously opposes the sale of F-16C/Ds to Taiwan, arguing
that they are offensive, rather than defensive in nature, and that selling them to Taiwan would run
counter to the U.S. pledge in the 1982 Communiqué not to sell arms to Taiwan that “exceed,
either in qualitative or in quantitative terms, the level of those supplied in recent years.” Sec.
1281 of the FY2013 National Defense Authorization Act (P.L. 112-239) stated that it was the
Sense of the Congress that the President should take steps to address Taiwan’s shortfall in fighter
aircraft, “whether through the sale of F-16 C/D aircraft or other aircraft of similar capacity.”
For more information, see CRS Report RL30957, Taiwan: Major U.S. Arms Sales Since 1990, by
Shirley A. Kan.
Economic Issues
The U.S. and Chinese economies are the first and second largest in the world respectively, and are
heavily interdependent. The Obama Administration has sought to cooperate with China in
rebalancing the global economy, working both bilaterally and through the mechanism of the G-20
grouping of nations. It also acknowledges that the two nations are engaged in what President
Obama calls “healthy economic competition.”101 Bilateral economic issues include the issue of
(...continued)
http://www.wantchinatimes.com/news-subclass-cnt.aspx?cid=1102&MainCatID=&id=20120517000109.
99 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/.
100 U.S. Congress, House Committee on Foreign Affairs, Testimony of Dr. Kurt M. Campbell, 112th Cong., October 4,
2011, http://www.state.gov/p/eap/rls/rm/2011/10/174980.htm.
101 The White House Office of the Press Secretary, “Remarks by President Obama and President Xi Jinping of the
People’s Republic of China Before Bilateral Meeting,” press release, June 7, 2013.
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commercial cyber espionage allegedly originating from China; China’s currency and industrial
policies; and China’s weak enforcement of intellectual property rights. Both countries have
welcomed the growth of Chinese foreign direct investment in the United States, although China
has complained about U.S. scrutiny of investments on national security grounds. The primary
bilateral fora for discussion of economic issues are the U.S.-China Strategic and Economic
Dialogue (S&ED) and the Joint Commission on Commerce and Trade (JCCT).
For more information, see CRS Report RL33536, China-U.S. Trade Issues, by Wayne M.
Morrison, and CRS Report RL33534, China’s Economic Rise: History, Trends, Challenges, and
Implications for the United States, by Wayne M. Morrison.
Basic Facts About the U.S.-China Economic Relationship
Basic facts about the bilateral economic relationship include
• The U.S. and Chinese economies are the first and second largest in the world
respectively on both a nominal dollar basis and a purchasing power parity basis.
In 2011, according to the World Bank, U.S. nominal GDP was more than twice
the size of China’s, at $14.99 trillion compared to China’s $7.3 trillion.102
• According to official U.S. trade data, China is the United States’ second largest
trading partner, after Canada. Two-way trade in 2012 topped $536 billion.
China’s exports to the United States totaled $426 billion, and U.S. exports to
China totaled $111 billion. The U.S. goods trade deficit with China was $315
billion.
• According to Chinese data, the United States is China’s largest trading partner
and U.S.-China two-way trade in 2012 was $480 billion, with Chinese exports to
the United States totaling $352 billion and U.S. exports to China totaling $128
billion. Chinese data shows the Chinese trade surplus with the United States to be
$224 billion.103
• China is the United States’ largest supplier of imports, third largest export market
(after Canada and Mexico), second largest agricultural export market (after
Canada), and fifth largest market for exports of private services. Imports from
China make up 19% of all U.S. imports and exports to China account for 7% of
all U.S. exports.
• For at least 124 countries, China is now a larger trading partner than the United
States.104
• China is the largest foreign holder of U.S. Treasury securities, holding $1.25
trillion in U.S. Treasury securities as of the end of March 2013. On that date,
China’s holdings represented 21.7% of all foreign holdings of U.S. Treasury
securities, and 7.4% of total outstanding U.S. debt.105
102 World Bank data, http://data.worldbank.org/country/china.
103 CRS Report RS22640, What’s the Difference?—Comparing U.S. and Chinese Trade Data, by Michael F. Martin.
104 Joe McDonald and Youkyung Lee, “AP Impact: China Surpasses US As Top Global Trader,” Associated Press,
December 2, 2012.
105 Department of the Treasury, Major Foreign Holders of Treasury Securities, March 15, 2013,
(continued...)
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• According to U.S. data, by 2011 U.S. businesses had invested a cumulative $60.5
billion in China, an increase of 21.4% from 2009.106
• According to U.S. Bureau of Economic Analysis (BEA) figures, cumulative
Chinese foreign direct investment (FDI) in the United States, reached $3.8 billion
in 2011, just 6% of U.S. FDI in China, but a six-fold increase over 2007.107
Private-sector researchers believe that Chinese FDI in the United States is several
times larger than the BEA figure.108
Commercial Cyber Espionage
Cyber espionage allegedly originating from China is a rapidly growing issue in the U.S.-China
relationship. After years of discussing the issue only in classified writings, the U.S. government in
2011 made public some of its concerns in a report to Congress issued by the Office of the
National Counterintelligence Executive (NCIX).109 The NCIX report described Chinese actors as
“the world’s most active and persistent perpetrators of economic espionage,” and both the
Chinese and Russian governments as “aggressive and capable collectors of sensitive U.S.
economic information and technologies, particularly in cyberspace.” The report noted that U.S.
businesses and cyber security experts had reported “an onslaught of computer network intrusions
originating from Internet Protocol (IP) addresses in China,” although it also noted the difficulty of
“attribution,” or determining what entities were behind the attacks, whether individuals, corporate
actors or state actors.
In February 2013, Mandiant, a private information security company, published a report accusing
a Shanghai-based unit of the People’s Liberation Army of cyber espionage targeting multiple U.S.
and other corporations.110 In remarks to the Asia Society the next month, National Security
Advisor Tom Donilon spoke out against “sophisticated, targeted theft of confidential business
information and proprietary technologies through cyber intrusions emanating from China on an
unprecedented scale,” but did not explicitly accuse the Chinese Communist Party or the
government of complicity in the intrusions.111 The U.S. government for the first time publicly
pinned responsibility on official Chinese actors in May 2013. In a report to Congress that month,
(...continued)
http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt; Department of the Treasury,
Treasury Direct, “The Debt to the Penny and Who Holds It,” http://www.treasurydirect.gov/NP/debt/current.
106 Office of the United States Trade Representative, “U.S.-China Trade Facts,” http://www.ustr.gov/countries-regions/
china-mongolia-taiwan/peoples-republic-china. Accessed June 5, 2013.
107 Bureau of Economic Analysis, Foreign Direct Investment in the U.S.: Balance of Payments and Direct Investment
Position Data, http://www.bea.gov/international/di1fdibal.htm.
108 Thilo Hanemann and Daniel H. Rosen, China Investment Monitor: Tracking Chinese Direct Investment in the U.S.,
Rhodium Group, http://rhgroup.net/interactive/china-investment-monitor.
109 Office of the National Counterintelligence Executive, Foreign Spies Stealing U.S. Economic Secrets in Cyberspace:
Report to Congress on Foreign Balance Economic Collection and Industrial Espionage, 2009-2011, October 2011,
http://www.ncix.gov/publications/reports/fecie_all/Foreign_Economic_Collection_2011.pdf.
110 Mandiant, APT1: Exposing One of China’s Cyber Espionage Units, February 2013, http://intelreport.mandiant.com/.
111 The White House Office of the Press Secretary, “Remarks By Tom Donilon, National Security Advisor to the
President: The United States and the Asia-Pacific in 2013,” remarks to the Asia Society, March 11, 2013,
http://www.whitehouse.gov/the-press-office/2013/03/11/remarks-tom-donilon-national-security-advisory-president-
united-states-a.
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the Department of Defense wrote that cyber-intrusions targeting U.S. government and other
computer systems “appear to be attributable directly to the Chinese government and military.”112
As accusations of official Chinese actors’ involvement in cyber intrusions have mounted, official
Chinese spokespeople have frequently dismissed the allegations as “groundless,” citing the
difficulty of attribution of cyberattacks and intrusions. Responding to the Mandiant report in
February 2013, a spokesman for China’s Ministry of National Defense stated that, “the Chinese
military has never supported any hacker activity.” He noted that Chinese law prohibits hacker
attacks and “other such activities that undermine the security of the Internet.” He also stated that
China is itself a major victim of network attacks, with the networks of the Ministry of National
Defense and China Military Online coming under attack more than 144,000 times a month on
average, with 63% of the attacks allegedly originating from the United States.113
Without acknowledging responsibility for cyber intrusions targeting U.S. entities, China has
agreed to the establishment of a high-level working group on cyber security under U.S.-China
Strategic Security Dialogue, a sub-dialogue of the two countries’ Strategic and Economic
Dialogue. The cyber dialogue is to be headed on the Chinese side by the State Councilor for
Foreign Affairs and a PLA Deputy Chief of the General Staff. Donilon has said that it will discuss
“the rules and norms of behavior in cyberspace” and “confidence-building measures.”114 As noted
above, however, former National Security Agency contractor Edward Snowden’s allegations
related to U.S. intelligence collection programs may have complicated the U.S. effort to hold
China to account for cyber-enabled theft targeting the United States. (See “June 8, 2013: Reported
Leaks Involving Intelligence Collection Programs and Hong Kong.”)
For more information, see CRS Report R42984, The 2013 Cybersecurity Executive Order:
Overview and Considerations for Congress, by Eric A. Fischer et al.
Global Rebalancing and China’s 12th Five-Year Plan
World leaders have acknowledged the need for fundamental restructuring of the global economy,
with major onus for action on the United States and China. According to the World Bank, the
United States had the world’s largest current account deficit in 2011, while China had the world’s
second 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 and
consume more.
China signaled its intention to tackle its side of the equation in its 12th Five-Year Plan, an
authoritative plan for national economic and social development covering the years 2011 to 2015.
Adopted by China’s National People’s Congress in March 2011, the plan calls for boosting
domestic consumption as a percentage of GDP, in part by increasing wages for Chinese workers
112 Office of the Secretary of Defense, Annual Report to Congress: Military and Security Developments Involving the
People’s Republic of China 2013, May 7, 2013, p. 36, http://www.defense.gov/pubs/2013_china_report_final.pdf.
113 Ministry of National Defense of the People’s Republic of China, Regular News Conference Hosted By Senior
Colonel Geng Yansheng, February 28, 2013.
114 The White House Office of the Press Secretary, “Press Briefing by National Security Advisor Tom Donilon,”
transcript, June 8, 2013, http://www.whitehouse.gov/the-press-office/2013/06/09/press-briefing-national-security-
advisor-tom-donilon.
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and improving China’s social welfare net, so that citizens do not need to set aside so much of
their incomes to pay for education, health care, and retirement. The 12th Five-Year Plan also
prioritizes development of seven sectors, three intended to support China’s goal of moving toward
more environmentally sustainable growth, and four intended to support China’s goal of moving
away from labor-intensive low-end manufacturing.115
In February 2012, a think tank under China’s cabinet, the Development Research Center of the
State Council, and the World Bank jointly released China 2030, a blueprint for fundamental
restructuring of the Chinese economy that builds on the 12th Five-Year Plan, but carries planning
forward to 2030.116 Its six sets of recommendations include
• Changing the role of government in the Chinese economy, including far-reaching
changes to China’s state sector;
• promoting innovation through development of world-class universities and
“innovative cities;”
• encouraging green development;
• improving provision of social services, especially to the rural population;
• strengthening the fiscal system, in part to ease the problem of unfunded mandates
at lower levels of government; and
• “becoming a pro-active stake-holder in the global economy, actively using
multilateral institutions and frameworks, and shaping the global governance
agenda.”
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. The size of the U.S. trade deficit
with China has risen with the greater volume of trade.
115 KPMG China, China’s 12th Five-Year Plan: Overview, March 2011, http://www.kpmg.com/CN/en/
IssuesAndInsights/ArticlesPublications/Publicationseries/5-years-plan/Documents/China-12th-Five-Year-Plan-
Overview-201104.pdf.
116 The World Bank and the Development Research Center of the State Council, People’s Republic of China, China
2030: Building a Modern, Harmonious, and Creative High-Income Society, February 27, 2012, http://www-
wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2012/02/28/000356161_20120228001303/
Rendered/PDF/671790WP0P127500China020300complete.pdf.
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Table 1. U.S. Merchandise Trade with China over Time
U.S. Imports from
U.S. Exports to
U.S. Trade Deficit
Year
China
China
with China
1995
$46 billion
$12 billion
$34 billion
2000
$100 billion
$16 billion
$84 billion
2005
$243 billion
$41 billion
$202 billion
2010
$365 billion
$92 billion
$273 billion
2012
$426 billion
$111 billion
$315 billion
Source: U.S. International Trade Commission.
Note: This table does not reflect U.S. trade with China in services, in which the United States runs a surplus.
Economists argue that the global trade balance is a more meaningful indicator of an economy’s
health than bilateral balances, and in recent years, China’s current account surplus has fallen
significantly, as a share of GDP, from 10.1% in 2007 to 2.3% in 2012.117 Many U.S. 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 increase
in exports to the United States reflects the shifting of production from other countries to China,
with many “made in China” products containing components made in other countries, with China
adding only a small percentage of the value. In trade statistics, however, the entire value of such
products is counted as being from China.
For more information, see CRS Report RL33536, China-U.S. Trade Issues, by Wayne M.
Morrison, and CRS Report RS22640, What’s the Difference?—Comparing U.S. and Chinese
Trade Data, by Michael F. Martin.
China’s Currency Policy
The issue of China’s management of its currency, the renminbi (“people’s money”) or RMB, once
topped the Obama Administration’s shortlist of economic disputes with China. It remains a major
concern, but appears to have lost some of its urgency as other economic disputes with China have
moved to the fore, and as China has continued to allow its currency to appreciate gradually.
According to the U.S. Treasury Department, Chinese leaders increasingly acknowledge the value
of a stronger RMB as a tool to combat inflation, and have made commitments at the G-20 and the
S&ED to promote greater flexibility in the exchange rate and to “gradually reduce the pace of
accumulation of foreign reserves.”118 According to Treasury Department data, from June 2010,
117 Department of the Treasury, Department of the Treasury Office of International Affairs, Report to Congress on
International Economic and Exchange Rate Policies, April 12, 2013, http://www.treasury.gov/resource-center/
international/exchange-rate-policies/Documents/Foreign%20Exchange%20Report%20April%202013.pdf.
118 U.S. Department of The Treasury, The 2011 U.S.-China Strategic and Economic Dialogue U.S. Fact Sheet –
Economic Track, May 10, 2011, http://www.treasury.gov/press-center/press-releases/Pages/TG1172.aspx.; U.S.
Department of the Treasury, Report to Congress on International Economic and Exchange Rate Policies, December 27,
2011, pp. 16, http://www.treasury.gov/resource-center/international/exchange-rate-policies/Documents/
FX%20Report%202011.pdf.
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when China’s central bank, the People’s Bank of China, announced a policy of greater exchange
rate “flexibility,” to early April 2013, the RMB appreciated against the U.S. dollar by 10% in
nominal terms. In real, inflation-adjusted terms, it appreciated 16.2% between June 2010 and
February 2013. From July 2005 to April 2013, China’s “real effective exchange rate” (REER)
appreciated 33.8% in real terms. The Treasury Department believes that “While the estimated
range of misalignment has narrowed, China’s real effective exchange rate continues to exhibit
significant undervaluation.”119 The U.S. government argues that 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.
For more information about China’s currency policy, see CRS Report RS21625, China’s Currency
Policy: An Analysis of the Economic Issues, by Wayne M. Morrison and Marc Labonte.
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, with $3.3 trillion in foreign currency reserves in December 2012,120 has been
either the largest or the number two foreign holder of U.S. Treasury securities since then, and thus
one of the largest foreign financers of the U.S. federal budget deficit. China’s holdings of U.S.
Treasury securities totaled $1.25 trillion as of the end of March 2013, accounting for 21.7% of all
foreign holdings of U.S. Treasury securities, and nearly 7.4% of total outstanding U.S. debt.
Japan was the second-largest holder of U.S. Treasury securities.121
Some observers have raised concerns about the possibility of China destabilizing the U.S.
economy by drawing down its holdings of U.S. Treasuries. Economists familiar with China’s
financial system note, however, that it does not allow foreign currency to be spent in China,
meaning that China has no choice but to invest its large current account surplus overseas; the
United States is the only economy large enough to absorb foreign exchange on the scale that
China is accumulating it.122 The combination of China’s large volume of 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. Some analysts argue that 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. Beijing has spoken out, for example,
about its concerns regarding the U.S. use of quantitative easing monetary policy to stimulate its
economy. China fears the policy could produce inflation in the United States or a devaluation of
the U.S. dollar, which would lessen the value of China’s U.S. dollar assets.
119 U.S. Department of the Treasury, Report to Congress on International Economic and Exchange Rate Policies, April
10, 2013, p. 3, http://www.treasury.gov/resource-center/international/exchange-rate-policies/Documents/
Foreign%20Exchange%20Report%20April%202013.pdf.
120 U.S. Department of the Treasury, Report to Congress on International Economic and Exchange Rate Policies,
December 27, 2011, pp. 18, http://www.treasury.gov/resource-center/international/exchange-rate-policies/Documents/
FX%20Report%202011.pdf.
121 Department of the Treasury, Major Foreign Holders of Treasury Securities, March 15, 2013,
http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt; Department of the Treasury,
Treasury Direct, “The Debt to the Penny and Who Holds It,” http://www.treasurydirect.gov/NP/debt/current.
122 Derek Scissors, Chinese Investment in the U.S.: $2 Trillion and Counting, The Heritage Foundation, blog post,
Washington, DC, March 1, 2011, http://www.heritage.org/Research/Reports/2011/02/Chinese-Investment-in-the-US-
$2-Trillion-and-Counting.
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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 “Indigenous Innovation” Policies
The U.S. business community has expressed strong concern about Chinese industrial policies that
appear to be 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 have included 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 allegedly used to try
to force technology transfers from foreign firms to Chinese firms.53
In the years since 2009, under pressure from the U.S. government and others, China has gradually
retreated from some of the most problematic elements of the policies. At the May 2010 Strategic
& Economic Dialogue, for example, China committed to ensure that its innovation policies were
nondiscriminatory and WTO-compliant. At the December 2010 meeting of the U.S.-China Joint
Commission on Commerce and Trade,54 China agreed not to base government procurement
decisions on where intellectual property is owned or developed, to submit a “robust” revised offer
to join the WTO’s Government Procurement Agreement, and to revise a major equipment
catalogue and ensure that it did not discriminate against foreign suppliers. In 2011, China
committed to de-link its indigenous innovation program from government procurement, eliminate
all government procurement product accreditation catalogues, and revise Article 9 of the draft
Government Procurement Law Implementing Regulations, which included preferences in
government procurement for national indigenous innovation products.123
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
10 countries.124 In its annual Special 301 Report to Congress, USTR highlighted “the growing
problem of misappropriation of trade secrets in China and elsewhere” and “troubling ‘indigenous
innovation’ policies that may unfairly disadvantage U.S. rights holders in China.” The report
noted that Chinese theft of trade secrets can occur in a wide range of circumstances, including
“departing employees, failed joint ventures, cyber intrusion and hacking, and misuse of
information submitted to government entities for the purposes of complying with regulatory
obligations.” It stated that, “In practice, remedies under Chinese law are difficult to obtain.”125
123 The White House, U.S. - China Joint Statement, January 19, 2011; U.S. Department of the Treasury, The 2011 U.S.-
China Strategic and Economic Dialogue U.S. Fact Sheet – Economic Track, May 10, 2011; U.S. Department of
Commerce, 22nd U.S.-China Joint Commission on Commerce and Trade Fact Sheet, November 21, 2011.
124 The other countries on USTR’s 2013 “Priority Watch List” are Algeria, Argentina, Chile, India, Indonesia, Pakistan,
Russia, Thailand, and Venezuela. United States Trade Representative, 2013 Special 301 Report, May 2013, p. 6,
http://www.ustr.gov/sites/default/files/05012013%202013%20Special%20301%20Report.pdfhttp://www.ustr.gov/sites/
default/files/2012 Special 301 Report_0.pdf.
125 United States Trade Representative, 2013 Special 301 Report, May 2013, pp. 4, 13, http://www.ustr.gov/sites/
default/files/05012013%202013%20Special%20301%20Report.pdfhttp://www.ustr.gov/sites/default/files/2012 Special
301 Report_0.pdf.
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In May 2013, a report by the Commission on the Theft of American Intellectual Property, headed
by Dennis C. Blair, former Director of National Intelligence, and Jon M. Huntsman, Jr., a former
U.S. Ambassador to China, estimated that annual U.S. losses due to international theft of U.S.
intellectual property “are likely to be comparable to the current annual level of U.S. exports to
Asia,” or over $300 billion. The report attributed “between 50% and 80%” of the problem to
China. “National industrial goals in China encourage IP theft, and an extraordinary number of
Chinese in business and government entities are engaged in the practice,” the Commission
alleged.126
China’s Compliance with World Trade Organization (WTO) 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. The U.S. Trade Representative charges that, “For much of the past decade, the
Chinese government has been re-emphasizing the state’s role in the economy, diverging from the
path of economic reform that drove China’s accession to the WTO.” Of particular concern to
USTR is China’s use of “new and more expansive industrial policies, often designed to limit
market access for imported goods, foreign manufacturers and foreign service suppliers, while
offering substantial government guidance, resources and regulatory support to Chinese industries,
particularly ones dominated by state-owned enterprises.”127
The United States has brought 15 dispute settlement cases against China at the World Trade
Organization, including eight under the Obama Administration (one in 2009, three in 2010, one in
2011, and three in 2012). China has brought eight WTO cases against the United States, five of
them during the Obama Administration’s time in office (two in 2009, one in 2011, and two in
2012).128
Of the three cases filed by the Obama Administration in 2012, one challenges Chinese restrictions
on exports of two rare earths (tungsten and molybdenum), which are important to for many high-
technology products, such as hybrid car batteries, wind turbines, and energy-efficient lighting.
The second case challenges Chinese duties on certain imported U.S. automobiles, and the third
case challenges alleged Chinese export subsidies to automobile and automobile parts enterprises
in China.129
Of the two cases China’s filed against the United States in 2012, one challenged U.S.
countervailing and anti-dumping measures imposed on certain products from China, and the other
challenged U.S. countervailing duty measures on certain products from China. In the first case, in
July 2012, a WTO panel found for China in determining that the U.S. Department of Commerce
126 The IP Commission Report, The Report of The Commission on the Theft of American Intellectual Property, May
2013, http://ipcommission.org/report/IP_Commission_Report_052213.pdf.
127 United States Trade Representative, 2012 Report to Congress On China’s WTO Compliance, December 2012,
http://www.ustr.gov/webfm_send/3620.
128 Details of disputes brought to the World Trade Organization by the United States and China can be found on the
World Trade Organization website at http://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm.
129 United States Trade Representative, 2012 Report to Congress on China’s WTO Compliance, December 2012,
http://www.ustr.gov/webfm_send/3620. pp. 23-27.
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had used a method for calculating dumping margins that was inconsistent with the WTO’s Anti-
Dumping Agreement.130
Notable U.S. victories at the WTO include a ruling upholding the U.S. imposition of duties on
Chinese tires (September 2011),131 and a ruling that China’s export restraints on certain industrial
raw materials were inconsistent with China’s WTO obligations (January 2012).132 In June 2011,
USTR announced that China had agreed to resolve one pending WTO case by ending subsidies to
Chinese manufacturers of wind power equipment who agreed to use parts and components made
in China, rather than imports.133
China has also scored victories against the United States at the WTO. In a case China filed in
2011 challenging U.S. anti-dumping measures on shrimp and diamond sawblades from China, for
example, a WTO panel in July 2012 found that the Department of Commerce had used a method
for calculating anti-dumping margins that was inconsistent with the WTO’s Anti-dumping
Agreement. In March 2011, a WTO Appellate Body ruled against the U.S. application of anti-
dumping and countervailing duty measures on four categories of Chinese products during the
George W. Bush Administration.134
For more information, see CRS Report RL33536, China-U.S. Trade Issues, by Wayne M.
Morrison; CRS Report R42510, China’s Rare Earth Industry and Export Regime: Economic and
Trade Implications for the United States, by Wayne M. Morrison and Rachel Tang; and CRS
Report RL33976, U.S. Trade Remedy Laws and Nonmarket Economies: A Legal Overview, by
Jane M. Smith.
Chinese Foreign Direct Investment in the United States
In June 2011, President Obama issued an Executive Order establishing SelectUSA, a
“government-wide initiative to attract and retain investment in the United States economy.”135
The initiative dovetails with a Chinese government initiative to promote overseas investment.
With both governments officially supporting greater Chinese investment in the United States,
Chinese foreign direct investment (FDI) has been growing steadily. The Obama Administration’s
blocking of several Chinese investments on national security grounds has, however, led to
complaints from China that investors feel the U.S. government’s welcome is not entirely
130 World Trade Organization, “Dispute DS422: United States—Anti-Dumping Measures on Shrimp and Diamond
Sawblades from China,” http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds422_e.htm.
131 Office of the United States Trade Representative, United States Prevails in WTO Dispute About Chinese Tire
Imports, September 4, 2011, http://www.ustr.gov/about-us/press-office/press-releases/2011/september/united-states-
prevails-wto-dispute-about-chinese.
132 Office of the United States Trade Representative, U.S. Trade Representative Ron Kirk Announces U.S. Victory in
Challenge to China’s Raw Materials Export Restraints, January 14, 2012, http://www.ustr.gov/about-us/press-office/
press-releases/2012/january/us-trade-representative-ron-kirk-announces-us-vict.
133 Office of the United States Trade Representative, China Ends Wind Power Equipment Subsidies Challenged by the
United States in WTO Dispute, June 8, 2011, http://www.ustr.gov/about-us/press-office/press-releases/2011/june/china-
ends-wind-power-equipment-subsidies-challenged.
134 United States Trade Representative, “USTR Statement Regarding WTO Appellate Body Report in Countervailing
Duty Dispute with China,” press release, March 11, 2011, http://www.ustr.gov/about-us/press-office/press-releases/
2011/march/ustr-statement-regarding-wto-appellate-body-report-c.
135 Executive Order 13577, “Establishment of the SelectUSA Initiative,” 76 Federal Register 35715, June 20, 2011,
http://www.gpo.gov/fdsys/pkg/FR-2011-06-20/pdf/2011-15443.pdf.
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wholehearted.136 The U.S. Ambassador to China Gary Locke, a former Secretary of Commerce,
has worked hard to overcome that impression, explicitly stating that, “America welcomes Chinese
investment,” and noting at investment seminars around China that only a small handful of
Chinese investments are reviewed on national security grounds each year.137 According to the
Heritage Foundation, which maintains a running count of Chinese firms’ “troubled transactions”
overseas as part of a project tracking global Chinese overseas investment, 2 of 16 failed Chinese
overseas transactions worldwide in 2012 involved the United States. In 2011, the count was 1 out
of 19.138
According to the U.S. Bureau of Economic Analysis, as of 2011, cumulative Chinese investment
in the United States had reached $3.8 billion.139 The Rhodium Group, a private economic research
firm, calculates that the total volume of Chinese direct investment in the United States is
significantly higher. Rhodium has tracked 650 deals involving Chinese FDI in the United States,
with a total value of $25.4 billion. According to Rhodium, the greatest number of deals has been
in the information technology sector. Deals with the greatest value have been in the entertainment
and real estate sectors.140 Rhodium reports that additional deals worth more than $10 billion were
announced or pending as of the first quarter of 2013.141
For more information, see CRS Report RL33388, The Committee on Foreign Investment in the
United States (CFIUS), by James K. Jackson.
Climate Change and Renewable Energy Cooperation
China relies heavily on coal to power its fast-growing economy and is the world’s largest emitter
of the most common greenhouse gas, carbon dioxide (CO2). According to the International
Energy Agency (IEA), China accounted for 24.1% of all global CO2 emissions in 2010, well
ahead of the United States.142 The IEA reports that its preliminary estimates show China’s
emissions grew 300 million tonnes (Mt), or 3.8%, in 2012, while U.S. emissions dropped 200 Mt.
The agency notes, however, that China’s emissions growth rate for 2012 was one of its lowest in a
decade, thanks to a greater reliance on renewable energy sources, particularly hydropower, and a
decline in the energy intensity of the Chinese economy.143 With China and the United States
136 See, for example, Rachelle Younglai, “Obama Blocks Chinese Wind Farms in Oregon over Security,” Reuters,
September 28, 2012, http://www.reuters.com/article/2012/09/28/us-usa-china-turbines-idUSBRE88R19220120928.
137 Embassy of the United Statesin Beijing, China, “Speech by Gary F. Locke, United States Ambassador to China,
Remarks, Chengdu, China,” press release, September 24, 2012, http://beijing.usembassy-china.org.cn/20120924-amb-
locke-chengdu.html.
138 The Heritage Foundation, China Global Investment Tracker Data Set, http://www.heritage.org/research/projects/
china-global-investment-tracker-interactive-map.
139 Bureau of Economic Analysis, Foreign Direct Investment in the U.S.: Balance of Payments and Direct Investment
Position Data, http://www.bea.gov/international/di1fdibal.htm.
140 Thilo Hanemann and Daniel H. Rosen, China Investment Monitor: Tracking Chinese Direct Investment in the U.S.,
Rhodium Group, http://rhgroup.net/interactive/china-investment-monitor.
141 Thilo Hanemann, Chinese FDI in the United States: Q1 2013 Update, Rhodium Group, April 30, 2013,
http://rhg.com/notes/chinese-fdi-in-the-united-states-q1-2013-update.
142 International Energy Agency, Key World Energy Statistics 2012, 2012, p. 45, http://www.iea.org/publications/
freepublications/publication/name,31287,en.html.
143 International Energy Agency, Redrawing the Energy Climate Map, World Energy Outlook Special Report, pp. 9, 13,
26, http://www.worldenergyoutlook.org/media/weowebsite/2013/energyclimatemap/
RedrawingEnergyClimateMap.pdf.
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together responsible for nearly half of the world’s CO2 emissions, both countries are by necessity
key players in efforts to address climate change.
The Obama Administration has long sought to make cooperation with China in battling climate
change a pillar of a new relationship focused on global issues. The two countries’ different
perspectives on international climate change negotiations have frequently produced friction,
however. 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. Chinese officials have described pressures on
developing countries to accept legally binding emissions targets as an attempt to restrict those
countries’ rights to develop.144 The U.S. Congress has long indicated that it will not support
legally binding commitments, such as the Kyoto Protocol, to reduce U.S. emissions without
binding commitments from other major emitters, such as China.145 The Obama Administration
has adopted the same position.
On a trip to China in April 2013, Secretary of State Kerry, a long-time advocate of action on
climate change, appeared to make progress in advancing cooperation with China on the issue. The
two countries issued a joint statement on climate change committing to “forceful, nationally
appropriate action by the United States and China—including large-scale cooperative action.”
They agreed to establish a high-level climate change working group to explore ways to advance
cooperation on “technology, research, conservation, and alternative and renewable energy.” The
group is scheduled to deliver its findings at the July 2013 meeting of the two countries’ premier
dialogue mechanism, the Strategic and Economic Dialogue.”146 One of the first tangible products
of its work was a bilateral agreement announced at the Obama-Xi presidential summit in June to
address climate change through a joint commitment to reduce use of hydrofluorocarbons.147
Without agreeing to binding international commitments, China has set itself ambitious national
targets for reducing growth in its carbon emissions. In its 12th Five-Year Plan, an authoritative
economic planning document covering the years from 2011 through 2015, for example, the PRC
committed that by 2015, it would increase the share of non-fossil fuels in its primary energy mix
to 11.4%, cut energy consumption per unit of GDP by 16%, and cut carbon dioxide emissions per
144 China’s then-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.
145 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.
146 Department of State, “Joint U.S.-China Statement on Climate Change,” April 13, 2013, http://www.http://
www.state.gov/r/pa/prs/ps/2013/04/207465.htm.
147 The White House Office of the Press Secretary, “United States and China Agree to Work Together on Phase Down
of HFCs,” press release, June 8, 2013, http://www.whitehouse.gov/the-press-office/2013/06/08/united-states-and-china-
agree-work-together-phase-down-hfcs.
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unit of GDP by 17%.148 A government report adopted at the annual National People’s Congress
plenary session in March 2013, stated that China reduced carbon dioxide emissions per unit of
GDP by 5.02% over the previous year, 1.5 percentage points higher than the planned target for the
year.149
National Security Advisor Tom Donilon stated in an April 2013 speech that the United Nations
has “a national interest” in “increasing global access to secure, affordable and ever cleaner
supplies of energy.”150 Propelled by that conviction, the United States is already cooperating with
China in the areas of energy efficiency and clean energy technology. During President Obama’s
November 2009 state visit to China, the United States and China announced the establishment of
a $150 million initiative surrounding a new, virtual U.S.-China Clean Energy Research Center
(CERC). The CERC and other components were tasked with researching and jointly developing
energy efficient buildings, electric vehicles, and clean coal technologies over the subsequent five
years. It took the nongovernmental participants until September 2011, however, to work out
formal agreements to protect intellectual property necessary for the research to move forward.151
Areas of bilateral collaboration on clean energy include joint government and public-private
initiatives to determine roadmaps for broad renewable energy deployment in both countries,
increase efficiency of renewable energy power plants, promote cleaner use of coal and large-scale
carbon capture and storage, and assess China’s shale gas resources.
China has also become a leader in the production of some renewable energy technologies, such as
photovoltaic solar panels, as well as carbon capture and storage, although experts say the PRC
continues to lag behind the United States in research and development. The United States and
China have engaged in heated trade disputes over some renewable technologies. In October 2012,
the U.S. Department of Commerce announced a decision to impose anti-dumping tariffs ranging
from 18% to 250% on solar-energy cells imported from China, having determined that without
the tariffs, the imports threatened to injure the domestic solar industry.152 As noted above, the
United States also challenged the Chinese government’s support for its domestic wind turbine
industry through the World Trade Organization, winning an agreement from China to end certain
148 “Key targets of China’s 12th five-year plan,” Xinhua News Agency, March 5, 2011, http://news.xinhuanet.com/
english2010/china/2011-03/05/c_13762230.htm; “China adopts 5-year blueprint, aiming for fairer, greener growth,”
Xinhua News Agency, March 14, 2011, http://news.xinhuanet.com/english2010/china/2011-03/14/c_13777814.htm.
149 “Full text: Report on China’s economic, social development plan,” Xinhua News Agency, March 19, 2013,
http://news.xinhuanet.com/english/china/2013-03/19/c_132246080_5.htm.
150 The White House Office of the Press Secretary, “Remarks by Tom Donilon, National Security Advisor to the
President At the Launch of Columbia University’s Center on Global Energy Policy,” press release, April 24, 2013,
http://www.whitehouse.gov/the-press-office/2013/04/24/remarks-tom-donilon-national-security-advisor-president-
launch-columbia-.
151 Funding provided by the United States government will only be applied to projects conducted by U.S. institutions
and individuals. U.S. Department of Energy, U.S.-China Clean Energy Cooperation: A Progress Report by the U.S.
Department of Energy, January 2011, p. 1, http://energy.gov/sites/prod/files/USChinaCleanEnergy_0.PDF. U.S.
Department of Energy, U.S., China Reach Agreement on Intellectual Property Protections for U.S.-China Clean
Energy Research Center, September 23, 2011, http://energy.gov/articles/us-china-reach-agreement-intellectual-
property-protections-us-china-clean-energy-research.
152 Department of Commerce International Trade Administration, Commerce Finds Dumping and Subsidization of
Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled into Modules from the People’s Republic of China,
Fact Sheet, October 10, 2012, http://ia.ita.doc.gov/download/factsheets/factsheet_prc-solar-cells-ad-cvd-finals-
20121010.pdf; and Department of Commerce International Trade Administration, “Commerce Preliminarily Finds
Dumping of Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled into Modules from the People’s
Republic of China,” press release, May 17, 2012, http://ia.ita.doc.gov/download/factsheets/factsheet-prc-solar-cells-ad-
prelim-20120517.pdf.
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subsidies.153 China’s ambitious plans to double its hydropower capacity by 2020 have embroiled
it in disputes with down-river neighbors in Southeast and South Asia and fed criticism from
overseas groups about China’s management of transboundary water resources.
For more information, see CRS Report R41919, China’s Greenhouse Gas Emissions and
Mitigation Policies, by Jane A. Leggett; CRS Report R40001, A U.S.-Centric Chronology of the
International Climate Change Negotiations, by Jane A. Leggett; and CRS Report R41748, China
and the United States—A Comparison of Green Energy Programs and Policies, by Richard J.
Campbell.
Democracy Promotion and Human Rights Issues
The PRC is an authoritarian state that has been governed since its founding in 1949 by the
Chinese Communist Party (CCP). While other minor political parties exist, they are authorized by
the CCP and are essentially powerless. The CCP is deeply intolerant of dissent and suspicious that
forms of speech, assembly, religion, and association that it does not control could be used to
topple it from power. That said, Chinese citizens are today freer to choose where they want to
live, work, and travel than at any time in the PRC’s history, and the rapid growth of social media
has dramatically broadened the scope of public debate, even as both social media and the
mainstream media continue to be subject to Communist Party censorship.
In speeches about their vision for Asia, President Obama and officials in his Administration have
often spoken about the need to advance democracy and, without directly naming China, appeared
to criticize China’s political system and to cast doubt on China’s fitness to serve as a model for
the developing world. Speaking at a press conference in Bangkok in November 2012, for
example, President Obama responded to a question about the attractiveness of China’s system of
government by arguing that “the notion somehow that you can take shortcuts and avoid
democracy, and that that somehow is going to be the mechanism whereby you deliver economic
growth, I think is absolutely false.” The alternative to democracy, he continued, “is a false hope
that, over time, I think erodes and collapses under the weight of people whose aspirations are not
being met.”154 In remarks in Canberra, Australia a year earlier that some in China saw as directed
at Beijing, Obama spoke of U.S. support for fundamental rights, including “the freedom of
citizens to choose their own leaders.” He described communism and rule by committee as
“failed” models of governance, and declared that “prosperity without freedom is just another form
of poverty.”155
153 Office of the United States Trade Representative, China Ends Wind Power Equipment Subsidies Challenged by the
United States in WTO Dispute, June 8, 2011, http://www.ustr.gov/about-us/press-office/press-releases/2011/june/china-
ends-wind-power-equipment-subsidies-challenged.
154 The President’s comments were prompted by a questioner at a joint press conference hosted by President Obama
and Thai Prime Minister Yingluck Shinawatra who referenced the U.S. fiscal crisis and asked, “And why shouldn’t
China’s system of government look more appealing in this region when you confront a situation like this in the U.S.?”
The White House Office of the Press Secretary, “Remarks by President Obama and Prime Minister Shinawatra in a
Joint Press Conference,” press release, November 18, 2012, http://www.whitehouse.gov/the-press-office/2012/11/18/
remarks-president-obama-and-prime-minister-shinawatra-joint-press-confer.
155 The White House Office of the Press Secretary, “Remarks by President Obama to the Australian Parliament,” press
release, November 17, 2012, http://www.whitehouse.gov/the-press-office/2011/11/17/remarks-president-obama-
australian-parliament.
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The Administration’s rhetoric has contributed to strategic mistrust between the United States and
China’s ruling Communist Party, which has long suspected the United States of being
uncomfortable with China’s political system and of wanting to end the Chinese Communist
Party’s monopoly on power. In its direct engagement with China, however, the Obama
Administration has tended to prioritize the overall stability of the U.S.-China relationship over
progress on its democracy promotion agenda. With Chinese officials, U.S. officials press the
argument that, in the words of former Assistant Secretary of State Michael H. Posner, “societies
that respect human rights and address aspirations of their own people are more prosperous,
successful, and stable.”156 In that context, the United States has urged China to ease restrictions
on freedom of speech, internet freedom, religious and ethnic minorities, and labor rights.
U.S. tools to register its concerns about China’s human rights record include public statements
from senior U.S. officials; the annual State Department reports on human rights and international
religious freedom; meetings with Chinese officials; exchanges in bilateral dialogues, including a
bilateral dialogue on human rights; Congressional hearings, public statements, and legislation;
and Congressionally-mandated U.S. assistance programs.
For more information, see CRS Report RL34729, Human Rights in China and U.S. Policy, by
Thomas Lum.
The Annual State Department Human Rights Report on China and
China’s Response
An April 2013 State Department briefing on the release of the Department’s suite of country
reports on human rights practices in 2012 highlighted China, Egypt, and Russia as countries with
“a shrinking space for civil society.”157 The State Department’s China report raised specific U.S.
concerns about “repression and coercion” aimed at those involved in rights advocacy. Using
language similar to that in the 2011 report, the 2012 report stated that those the government
deemed politically sensitive continued to face “tight restrictions on their freedom to assemble,
practice religion, and travel,” and that “[e]fforts to silence and intimidate political activists and
public interest lawyers continued to increase.” In addition, the report cited “severe official
repression of the freedoms of speech, religion, association, and harsh restrictions on the
movement of ethnic Uighurs in the Xinjiang Uighur Autonomous Region (XUAR) and of ethnic
Tibetans in the Tibet Autonomous Region (TAR) and other Tibean areas.”158
The Chinese government has long been critical of the annual State Department human rights
reports. In May 2013, a month after the release of the State Department’s 2012 report on human
rights in China, China released a white paper defending its human rights record and implicitly
criticizing the U.S. focus on civil and political rights. The white paper stated that China prioritizes
156 U.S. Department of State, “Assistant Secretary Michael H. Posner: Briefing on the 17th U.S.-China Human Rights
Dialogue,” press release, July 25, 2012, http://www.state.gov/j/drl/rls/rm/2012/195498.htm.
157 Department of State, Uzra Zeya, Acting Assistant Secretary, Bureau of Democracy, Human Rights, and Labor,
“Remarks on the Release of the Country Reports on Human Rights Practices for 2012,” press release, April 19, 2013,
http://www.state.gov/j/drl/rls/rm/2013/207797.htm.
158 U.S. Department of State Bureau of Democracy, Human Rights and Labor, Country Reports on Human Rights
Practices for 2012: China (includes Tibet, Hong Kong, and Macau), April 19, 2012, http://www.state.gov/j/drl/rls/
hrrpt/humanrightsreport/index.htm#wrapper.
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rights to subsistence and development, and promotes economic, social, and cultural rights, as well
as civil and political rights.159
U.S.-China Dialogues on Human Rights
The primary forum for U.S.-China discussion of human rights is the bilateral Human Rights
Dialogue, which resumed in 2008 after a six-year hiatus. It met most recently in July 2012 in
Washington, DC. Analysts have identified both drawbacks and benefits to holding human rights
discussions in the context of a stand-alone dialogue. Some critics have argued that the
arrangement isolates human rights from the core areas of U.S.-China relations. Critics also note
that the chief Chinese interlocutor for the dialogue represents China’s Foreign Ministry, which
has little involvement with the formulation or implementation of policies affecting the political
and civil rights of Chinese citizens. The Obama Administration argues that the stand-alone
dialogue allows for thorough discussion of sensitive and contentious issues.
A second U.S.-China dialogue, the Legal Experts Dialogue (LED), resumed in June 2011 after a
six-year hiatus. The most recent LED took place in April 2012 in Beijing and the next session is
scheduled to be held in the United States in 2013. The LED is designed to serve as a forum to
discuss the means of implementing an effective system of rule of law.
U.S. Assistance to China160
The State Department classifies China “as a development partner with the resources to invest in
its own future, not as an aid recipient.” Department of State foreign assistance to China is
focused on promoting human rights, democracy, and the rule of law in China, and sustainable
livelihoods and cultural preservation in Tibetan areas of China. Other programs included the
Peace Corps and HIV/AIDS prevention, care, and treatment. Appropriations for assistance to
China peaked in FY2010 at $46.9 million. FY2012 funding was $28.3 million, or 60% of the
2010 level. Most direct recipients of State Department and U.S. Agency for International
Development (USAID) grants have been U.S.-based nongovernmental organizations (NGOs) and
universities.
For more information, see CRS Report RS22663, U.S. Assistance Programs in China, by Thomas
Lum.
Political Prisoners161
The San Francisco-based humanitarian organization Dui Hua, which maintains an authoritative
database of Chinese political prisoners, lists 4,947 known cases of people currently imprisoned in
159 “China Issues White Paper on Human Rights,” Xinhua News Agency, May 14, 2013; Information Office of the State
Council, “Full Text: Progress in China’s Human Rights in 2012,” Xinhua News Agency, May 14, 2013,
http://news.xinhuanet.com/english/china/2013-05/14/c_132380706.htm.
160 This section is authored by Thomas Lum, CRS Specialist in Asian Affairs.
161 For more information about these and hundreds of other political and religious prisoners known or believed to be
detained or imprisoned in China, see the Congressional-Executive Commission on China’s (CECC) political prisoner
database: Congressional-Executive Commission on China, Political Prisoner Database (PPD), http://ppd.cecc.gov/.
All names are listed in the Chinese style, with the family name preceding the given name. Chen Wei’s family name, for
example, is Chen.
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China on political and religious grounds.162 That number includes political dissidents imprisoned
for expressing their opposition to one-party rule; religious practitioners persecuted for beliefs that
are not officially sanctioned; ethnic minorities accused of participating in cultural and pro-
independence movements; and protesters, known as “petitioners,” imprisoned for their efforts to
seek redress for miscarriages of justice and corruption. In an April 2013 briefing, a State
Department official identified the following prisoners as priority cases for U.S. government
advocacy:163
• Chen Kegui. Chen is the nephew of the Chinese legal advocate Chen
Guangcheng, who took refuge in the U.S. Embassy in Beijing for six days in
May 2012, and ultimately left China for the United States after tense, high-profile
U.S.-China diplomatic negotiations over his fate. In November 2012, six months
after Chen Guangcheng left China, a court in Shandong Province sentenced Chen
Kegui to 39 months in prison for wielding a kitchen knife against a group of men
who stormed his house after his uncle’s escape to the U.S. Embassy.164 A State
Department spokeswoman said the United States was “deeply concerned” about
the verdict, which she said resulted from “a deeply flawed legal process.”165 Chen
Guangcheng has characterized Chinese authorities’ treatment of his nephew as a
form of “revenge” against him, and charged that his nephew is being used as a
“hostage” to try to force him to temper his criticism of China’s leaders while he
is in the United States.166
• Gao Zhisheng. A rights lawyer who defended Falun Gong practitioners and
others, Gai was detained and allegedly tortured in 2007 for over 50 days after
writing an open letter to the U.S. Congress criticizing the CCP’s human rights
record. Chinese authorities apprehended Gao in February 2009 and held him at
various unknown locations for over a year. Gao is now serving a three-year
sentence in Xinjiang after a court in Beijing revoked his parole in December
2011. His wife, Geng He, and children fled China and were granted asylum in the
United States in March 2009. Geng has since testified before Congress.
• Liu Xiaobo. A political dissident, writer and 2010 Nobel Peace Prize winner, Liu
was detained for six months and then sentenced to 11 years in prison in
December 2009 for “inciting subversion of state power” after helping to draft
Charter ’08,167 a manifesto disseminated online that called for an end to one-party
rule. Previously, Liu spent 20 months in prison for his role in the 1989
democracy movement, and three years in a re-education through labor (RTL)
camp for questioning Communist Party rule in 1996. Chinese authorities have
confined his wife, Liu Xia, to her home in Beijing since October 2010, the
162 Dui Hua, Political Prisoner Database, March 31, 2013, http://duihua.org/wp/?page_id=195.
163 Department of State, Uzra Zeya, Acting Assistant Secretary, Bureau of Democracy, Human Rights, and Labor,
“Remarks on the Release of the Country Reports on Human Rights Practices for 2012,” press release, April 19, 2013,
http://www.state.gov/j/drl/rls/rm/2013/207797.htm.
164 Keith B. Richburg, “Chen Guangcheng’s Nephew Found Guilty of Assault in China; Sentenced to 39 Months,” The
Washington Post, November 30, 2012.
165 Spokesperson Victoria Nuland, State Department Daily Press Briefing, November 30, 2012.
166 “’Reforms or Violence,’ Chen Tells Xi,” Radio Free Asia, December 3, 2012; “Chen Says Nephew Held
‘Hostage,’” Radio Free Asia, October 25, 2012.
167 “Charter ’08” commemorates the 60th anniversary of the United Nations’ adoption of the Universal Declaration of
Human Rights, and was inspired by “Charter 77,” the Czechoslovakian democratic movement.
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month that her husband’s Nobel prize was announced, cutting her off from
communication with friends, relatives, and the media.168
Tibet
Tibet is among the most sensitive issues in U.S.-China relations. The Chinese Communist Party
has controlled the Tibetan Autonomous Region (TAR) and other Tibetan areas within the PRC
since 1951, and the U.S. government recognizes all those areas as parts of China. Nonetheless,
the Communist Party continues to face resistance to its rule from Tibetans, most recently in the
form of a wave of self-immolations among Tibetans protesting Chinese policies. Chinese leaders
have long feared that the Tibet exile community and foreign governments seek to “split” Tibet
from China; China’s commitment to defending its sovereignty over Tibet has long been one of
China’s most fundamental “core interests,” on a par with China’s commitment to asserting its
sovereignty over Taiwan.
U.S. policy toward Tibet is guided by the Tibetan Policy Act of 2002 (P.L. 107-228), which
requires the U.S. government to promote and report on dialogue between Beijing and Tibet’s
exiled spiritual leader, the Dalai Lama, or his representatives; to help protect Tibet’s religious,
cultural, and linguistic heritages; and to support development projects in Tibet. The act requires
the State Department to maintain a Special Coordinator for Tibetan Issues. Until she stepped
down on February 4, 2013, Under Secretary of State for Civilian Security, Democracy, and
Human Rights Maria Otero served concurrently in the Tibet coordinator position, which is
currently vacant. The act also calls on the Secretary of State to “make best efforts” to establish a
U.S. consular office in the Tibetan capital, Lhasa; and directs U.S. officials to press for the release
of Tibetan political prisoners in meetings with the Chinese government.
With strong encouragement from the international community, including the United States,
Chinese officials and personal representatives of the Dalai Lama participated in nine rounds of
talks between 2002 and 2010. The Dalai Lama’s envoys came to the eighth round of the
negotiations with a proposal entitled, “Memorandum on Genuine Autonomy for All Tibetans.” In
it and a follow-up note, the Dalai Lama’s envoys argued for “genuine autonomy” for Tibetan
districts within the framework of the PRC. The documents stressed that the proposal “in no way
challenges or brings into question the leadership of the Communist Party in the PRC” or “the
socialist system of the PRC.”169 After the ninth round of talks in January 2010, senior Chinese
officials dismissed the proposal as tantamount to “half independence.”170 The Tibetan exile
government’s political leader, Lobsang Sangay, has appealed to China for a resumption of the
dialogue process, saying that the Tibetan exile side is “ready to engage in meaningful dialogue
anywhere, at any time.” He has called on the international community to help pressure China to
return to the negotiations, as well as to allow the U.N. High Commissioner for Human Rights,
diplomats, and the international media to visit Tibet.171 So far, however, no progress has been
reported in scheduling a tenth round of talks.
168 “Keith B. Richburg, “On Eve of Nobel Ceremony, China Cracks Down and Lashes Out,” The Washington Post,
December 9, 2010.
169 Central Tibetan Administration, Note on the Memorandum on Genuine Autonomy for the Tibetan People, February
19, 2010, http://www.savetibet.org/policy-center/topics-fact-sheets/note-memorandum-genuine-autonomy-tibetan-
people.
170 “Press Conference on Central Govt’s Contacts with Dalai Lama (text),” China Daily, February 11, 2010.
171 International Campaign for Tibet, The statement of Sikyong Dr. Lobsang Sangay on the 54th anniversary of the
(continued...)
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The U.S. government and human rights groups have been critical of increasingly expansive
official Chinese controls on religious life and practice in Tibetan areas instituted in the wake of
anti-Chinese protests in Tibetan areas in 2008. Human rights groups have catalogued arbitrary
detentions and disappearances; a heightened Chinese security presence within monasteries;
continued “patriotic education” and “legal education” campaigns that require monks to denounce
the Dalai Lama; strengthened media controls; and policies that weaken Tibetan-language
education. Since February 27, 2009, at least 117 Tibetans in China have set fire to themselves to
protest PRC policies, and 99 of them are known to have died.172 Many of those self-immolating
have been associated with the heavily policed Kirti Monastery in Aba County, Sichuan Province.
The Obama Administration has stated that it is “deeply concerned and saddened by the continuing
violence in Tibetan areas of China and the increasing frequency of self-immolations by Tibetans.”
It has called on China “to address policies in Tibetan areas that have created tensions.”173 China
accuses the Dalai Lama and his supporters of directing or encouraging the self-immolations,
which have garnered world headlines and shone an unfavorable light on the PRC’s policies. In
2012, the Dalai Lama described the self-immolations as “very, very sad” and the product of “a
very desperate situation,” but declined either to endorse or condemn them.174 In a March 2013
interview with Times Now, a major Indian television station, he said that if self-immolators are
motivated by compassion, “then such acts can also be positive.”175 Exile political leader Sangay
has taken a less equivocal stance. In a March 2013 speech, he said that his exile cabinet “has
consistently appealed and categorically discouraged Tibetans in Tibet from self-immolating as a
form of protest.” He maintained that the only way to end the self-immolations, however, is for
China to respect “the aspirations of the Tibetan people” by allowing the Dalai Lama’s return to
Tibet, as well as “freedom for the Tibetan people, and unity among Tibetans.”176
China lobbies strenuously to prevent world leaders from meeting with the Dalai Lama, the 1989
Nobel Peace Prize winner and 2006 recipient of the Congressional Gold Medal. Over China’s
objections, President Obama has met twice with the Dalai Lama at the White House, in February
2010 and July 2011.177
Treatment of Uighurs
Xinjiang, an area of northwest China known officially as the Xinjiang Uighur Autonomous
Region or XUAR, is home to several ethnic minority groups, including 8.5 million Uighurs, a
(...continued)
Tibetan National Uprising Day, March 10, 2013.
172 International Campaign for Tibet, Self-Immolations by Tibetans, May 29, 2013, http://www.savetibet.org/resource-
center/maps-data-fact-sheets/self-immolation-fact-sheet.
173 Department of State, “Statement by Special Coordinator for Tibetan Issues Maria Otero,” press release, December 5,
2012, http://www.state.gov/r/pa/prs/ps/2012/12/201594.htm.
174 Central Tibetan Administration, NBC Interviews His Holiness the Dalai Lama on Self-Immolation Tragedy in Tibet,
October 22, 2012.
175 “Special: The Dalai Lama,” Times Now, March 25, 2013, http://www.timesnow.tv/Special-The-Dalai-Lama—
1/videoshow/4423746.cms.
176 International Campaign for Tibet, The Statement of Sikyong Dr. Lobsang Sangay on the 54th Anniversary of the
Tibetan National Uprising Day, March 10, 2013.
177 The White House, The President’s Meeting with His Holiness the XIV Dalai Lama, July 16, 2011,
http://www.whitehouse.gov/blog/2011/07/17/president-s-meeting-his-holiness-xiv-dalai-lama.
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predominantly Muslim Turkic ethnic group.178 Due to migration into Xinjiang by members of the
Han, China’s largest ethnic group, Uighurs, once the predominant group in Xinjiang, constitute
roughly 45% of the population throughout the XUAR and are outnumbered four to one by Han in
Xinjiang’s capital, Urumqi.179 According to activist groups and the State Department’s 2011
human rights report on China, the Chinese government in Xinjiang has implemented policies that
have diluted Uighur identity, including the reduction or elimination of ethnic-language instruction
in school, and restrictions on access to mosques, the celebration of Ramadan, contact with
foreigners, and participation in the hajj. The PRC government prohibits Uighur children under 18
from entering mosques and government workers from practicing Islam. Uighurs face
discriminatory hiring practices that give preference to Han applicants, and XUAR government
demolition of the old city in Kashgar have angered locals. According to the State Department
human rights report on China and other rights organizations, the Chinese government has done
little to address Uighur grievances regarding the preservation of culture and identity, instead
focusing almost exclusively on the promotion of economic growth.
The government has cracked down particularly on the East Turkestan Islamic Movement (ETIM),
a Uighur organization that advocates the creation of an independent Uighur Islamic state, and
which the PRC claims has been responsible for small-scale terrorist attacks in China and has ties
to Al Qaeda. In 2002, during a period of increased cooperation between the United States and
China to combat terrorism, the State Department designated ETIM as a terrorist organization.
Human rights groups have argued that the PRC exaggerated the threat of ETIM to justify its
crackdown on dissent in the region, while others have noted the real threat posed by ETIM.
Concerned with Uighur separatism and ties to a pan-Islam movement in Central Asia, the Chinese
government has waged what it calls “strike hard campaigns” against what it terms the “three
forces”—religious extremism, ethnic separatism, and terrorism—often conflating Uighur activism
and peaceful dissent with terrorism. According to the human rights advocacy group Amnesty
International, the Chinese government has instituted restrictive policies against Uighurs,
including 24-hour street patrols, the sealing-off of neighborhoods with security check points,
arbitrary detentions, unfair trials and executions without judicial due process.180 Following large-
scale protests and inter-ethnic strife in Urumqi that left nearly 200 dead in July 2009, 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.
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.
178 Estimates of China’s Muslim population range from 20 million to 30 million people.
179 BBC, Xinjiang territory profile - overview, February 8, 2012, http://www.bbc.co.uk/news/world-asia-pacific-
16860974; U.S. Department of State, 2011 Human Rights Report: China, May 24, 2012, p 61, http://www.state.gov/j/
drl/rls/hrrpt/humanrightsreport/index.htm#wrapper.
180 Amnesty International, Annual Report 2012—China, 2012, http://www.amnesty.org/en/region/china/report-
2012#section-28-10.
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Appendix A. Laws Related to China Enacted in the
113th Congress
Table A-1. Law Related to China Enacted in the 113th Congress
Bill/Public
Date
Law
Signed
Number
Into Law
Title
Description of China-related Provisions
H.R. 933
March 26,
Consolidated and
Department of Commerce Appropriations Act, 2013 (127
(P.L. 113-6)
2013
Further Continuing
Stat. 234) provides for not less than $16.4 million for China
Appropriations Act,
antidumping and countervailing duty enforcement and
2013
compliance activities.
Sec. 109 (127 Stat. 242) requires the Department of
Commerce to provide a monthly report on any official travel
to China by any employee of the U.S. Department of
Commerce, including the purpose of such travel.
Sec. 516(a) (127 Stat. 272-273) states that appropriated
funds may not be used for the Department of Commerce,
the Department of Justice, the National Aeronautics and
Space Administration (NASA), or the National Science
Foundation to acquire an information technology system
unless the head of the entity, in consultation with the Federal
Bureau of Investigation or another appropriate Federal
entity, has made an assessment of any associated risk of
cyberespionage or sabotage, including any risk associated
with the system being produced, manufactured or assembled
by entities owned, directed or subsidized by the People’s
Republic of China. Sec. 516(b) states that appropriated funds
may not be used to acquire an information technology
system produced, manufactured, or assembled by entities
owned, directed, or subsidized by the PRC unless the entity
head determines that acquisition of such a system is in the
national interest of the United States, and reports that
determination to the House and Senate Committees on
Appropriations.
Sec. 535 (127 Stat. 277) states that no funds made available
by the act may be used for NASA or the White House
Office of Science and Technology Policy (OSTP) to
participate, collaborate, or coordinate bilaterally in any way
with China or any Chinese owned company, with certain
exceptions.
Title VII, Department of State, Foreign Operations, and
Related Programs (127 Stat. 427) provides $1.9 million for
salaries and expenses of the Congressional-Executive
Commission on the People’s Republic of China, and $3.31
mil ion for salary and expenses of the United States-China
Economic and Security Review Commission.
Source: Legislative Information System of the U.S. Congress.
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Table A-2. Simple Resolution Related to China Agreed to in the House
in the 113th Congress
Date
Resolution
Agreed
Number
To/Passed
Title Description
H.Res. 65
February 15, Condemning the
Calls on China to pressure North Korean leaders to curtail
2013
Government of
their provocative behavior and abandon and dismantle their
North Korea for its
nuclear and missile programs by curtailing vital economic
flagrant and repeated support and trade to North Korea. Also calls on China to
violations of multiple
comply with all relevant international agreements and U.N.
United Nations
Security Council and International Atomic Energy Agency
Security Council
resolutions.
resolutions, for its
repeated
Calls on China to take immediate actions to prevent the
provocations that
transshipment of illicit technology, military equipment, and
threaten
dual-use items through its territory, waters, and airspace
international peace
that could be used in North Korea’s nuclear weapons and
and stability, and for
ballistic missile programs.
its February 12,
2013, test of a
nuclear device
Source: Legislative Information System of the U.S. Congress.
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Appendix B. Laws Related to China Enacted in
the 112th Congress
Table B-1. Laws Related to China Enacted in the 112th Congress
Listed in reverse chronological order by date signed into law
Bill/Public
Date
Law
Signed
Number
Into Law
Title
Description of China-related Provisions
H.R. 4212
1/14/2013
Drywal Safety Act of
•
Sec. 2 states that it is the sense of the Congress that the
(P.L. 112-
2012
Secretary of Commerce “should insist” that China
266)
facilitate a meeting between Chinese drywall companies
and representatives of the U.S. government on
“remedying homeowners that have problematic drywal
in their homes”; and also “insist” that China direct
Chinese drywall manufacturers and exporters to submit
to jurisdiction in U.S. Federal Courts and comply with
any court decisions.
H.R. 1464
1/14/2013
North Korean Child
•
Sec. 2 states that is the sense of the Congress that
(P.L. 112-
Welfare Act of 2012a
North Korean children or children of one North
264)
Korean parent who are living outside North Korea may
face statelessness in neighboring countries, and that the
Secretary of State should advocate for their best
interests.
•
Sec. 4 requires the Secretary of State to designate a
representative to brief Congressional committees
regularly on U.S. government efforts to advocate for the
best interests of North Korean children residing outside
North Korea or children of one North Korean parent
living in other countries who are fleeing persecution or
are living as de jure or de facto stateless persons.
H.R. 4310
1/2/2013 National
Defense •
Sec. 1045 (126 Stat. 1933-1934) requires the
(P.L. 112-
Authorization Act for
Commander of the United States Strategic Command to
239)
Fiscal Year 2013
submit a report on the capability of the United States to
use conventional and nuclear forces to neutralize
China’s underground tunnel network and what is stored
within such tunnels. It also requires the Secretary of
Defense to enter into an agreement with a federally
funded research and development center to conduct an
assessment of China’s nuclear weapons program.
Required elements of the assessment include China’s
nuclear deterrence strategy; a detailed description of
China’s nuclear arsenal; a comparison of U.S. and
Chinese nuclear forces; projections for China’s future
nuclear arsenals; a description of command and control
functions and gaps; an assessment of China’s fissile
material stockpile and civil and military production
capabilities and capacities; an assessment of China’s
production capacities for nuclear weapons and nuclear
weapon delivery vehicles; a discussion of significant
uncertainties surrounding China’s nuclear weapons
program; and recommendations for improving U.S.
understanding of China’s nuclear weapons program.
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•
Sec. 1231 (126 Stat. 2003) requires the Chairman of the
Joint Chiefs of Staff to submit a report on U.S.
capabilities in relation to China, North Korea, and Iran.
The report is required to consider any critical gaps in
intelligence that limit the ability of the United States
Armed Forces to counter challenges or threats from
each country. The report is also required to consider
any gaps in the capabilities, capacity, and authorities of
the U.S. Armed Forces to counter challenges or threats
to U.S. personnel and U.S. interests in each country’s
region.
•
Sec. 1261(c)(1) and (2) (126 Stat. 2019) prohibit the
export, re-export, or direct or indirect transfer to
China of satellites or related items subject to Export
Administration Regulations.
•
Sec. 1271 (126 Stat. 2022-2023) requires additional
elements in the Department of Defense’s (DOD’s)
Annual Report on Military and Security Developments
Involving the People’s Republic of China.b They include
discussion of China’s electronic warfare capabilities and
details on the number of malicious cyber incidents
originating from China against DOD infrastructure. They
also include discussion of China’s space and
counterspace programs; nuclear program; anti-access
and area denial capabilities; command, control,
communications, computers, intelligence, surveillance,
and reconnaissance modernization program; navy and
paramilitary and maritime law enforcement vessels,
including their response to U.S. naval activities; military-
to-military relationships with other countries; any
significant sale or transfer of military hardware,
expertise, and technology from China, and any
significant assistance to and from “any selling state with
military-related research and development programs in
China.” Sec. 1271 drops the NDAA 2011’s requirement
for an assessment of the damage inflicted on the
Department of Defense from Chinese cyber activities.
•
Sec. 1281 (126 Stat. 2034) states that it is the sense of
Congress that the President should take steps to
address Taiwan’s shortfall in fighter aircraft, whether
through the sale of F-16 C/D aircraft or other aircraft of
similar capacity.
•
Sec. 1286 (126 Stat. 2039-2040) contains “The Sense of
Congress on the Situation in the Senkaku Islands.” It
states, among other things, that “while the United States
takes no position on the ultimate sovereignty of the
Senkaku Islands, the United States acknowledges the
administration of Japan over the Senkaku Islands,” and
the “the unilateral action of a third party will not affect
the United States’ acknowledgement” of Japanese
administration over the islands. The Sense of the
Congress also states that “the United States has national
interests in freedom of navigation, the maintenance of
peace and stability, respect for international law, and
unimpeded lawful commerce”; that the United States
“supports a col aborative diplomatic process by
claimants to resolve territorial disputes without
coercion, and opposes efforts at coercion, the threat of
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use of force, or use of force by any claimant”; and final y,
that “the United States reaffirms its commitment to the
Government of Japan under Article V of the Treaty of
Mutual Cooperation and Security.... ”
•
Sec. 3119 (126 Stat. 2174) requires the Secretary of
Energy to conduct a review of nonproliferation activities
with China to determine if the engagement is directly or
indirectly supporting the proliferation of nuclear
weapons development and technology to other nations.
It requires the Secretary of Energy to submit a report
certifying that nonproliferation activities with China are
not contributing to proliferation, and caps funding for
the U.S.-China Center of Excel ence on Nuclear Security
at $7 million until the report is submitted.
H.R. 4240
8/16/2012
Ambassador James R.
•
Sec. 2(5) states that Congress finds China has continued
(P.L. 112-
Lilley and
to forcibly repatriate North Koreans. Sec. 3(2) states
172)
Congressman
that it is the sense of the Congress that the United
Stephen J. Solarz
States should urge China to immediately halt its forcible
North Korea Human
repatriation of North Koreans, fulfill its obligations
Rights
under international agreements, and allow the United
Reauthorization Act
Nations High Commission for Refugees unimpeded
of 2012
access to North Koreans inside China to determine
whether such North Koreans are refugees requiring
protection.
H.R. 1540
12/31/2011 National
Defense
•
Section 1232(a)(2) (125 Stat. 1636) directs the
(P.L. 112-
Authorization Act for
Comptrol er General of the United States to conduct an
81)
Fiscal Year 2012
independent review of “any gaps between China’s anti-
access capabilities and United States’ capabilities to
overcome them.”
•
Section 1236(b)(4) (125 Stat. 1641) requires that a
report on military and security developments involving
North Korea, to be submitted to Congress by the
Secretary of Defense, include, among other things, an
assessment of North Korean regional security objectives
that affect the PRC and other countries.
•
Section 1238(a) (125 Stat. 1642) adds a requirement
that the Department of Defense’s annual report on
military and security developments involving the PRC
include “an assessment of the nature of China’s cyber
activities directed against the Department of Defense
and an assessment of the damage inflicted on the
Department of Defense by reason thereof.”
H.R. 2055
12/23/2011 Consolidated
•
The Department of State, Foreign Operations, and
(P.L. 112-
Appropriations Act,
Related Programs Appropriations Act, 2012 (125 Stat.
74)
2012
1173-1174) appropriates $2 million for the
Congressional-Executive Commission on the People’s
Republic of China and $3.5 million to the United States-
China Economic and Security Review Commission.
•
Sec. 7044(a) (125 Stat. 1230) requires the Secretary of
the Treasury to instruct the U.S. executive director of
each international financial institution to support
projects in Tibet if such projects do not provide
incentives for the migration and settlement of non-
Tibetans into Tibet or facilitate the transfer of
ownership of Tibetan land and natural resources to non-
Tibetans; are based on a thorough needs-assessment;
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foster self-sufficiency of the Tibetan people and respect
Tibetan culture and traditions; and are subject to
effective monitoring. It also requires Economic Support
Fund funds to be made available to nongovernmental
organizations to support activities which preserve
cultural traditions and promote sustainable development
and environmental conservation in Tibetan communities
in China.
•
Sec. 7044(f) (125 Stat. 1231) bars use of appropriated
funds for processing licenses to export satellites and
satellite components of U.S. origin to China, unless with
advance notification to the Committee on
Appropriations. Sec. 7044(f) also bars use of
appropriated funds to finance any grant, contract, or
cooperative agreement with China’s People’s Liberation
Army (PLA), or any entity that the Secretary of State
has reason to believe is owned or control ed by, or an
affiliate of, the PLA.
•
Sec. 7076(a) (125 Stat. 1256) requires the Secretary of
State to hire sufficient consular officers to reduce visa
interview wait times in China, Brazil, and India.
•
Sec. 7085(c) (125 Stat. 1264) bars the United Nations
Population Fund from using appropriated funds for
country programs in China. If a required report from
the Secretary of State indicates that UNFPA plans to
spend funds for a country program in China, Sec.
7085(e)(2) requires that the amount be deducted from
the funds made available to UNFPA.
H.R. 2112
11/18/2011 Consolidated
and
•
The Department of Commerce Appropriations Act,
(P.L. 112-
Further Continuing
2012 (125 Stat. 591) appropriates not less than $7
55)
Appropriations Act,
mil ion for the Office of China Compliance in the
2012
Department of Commerce’s International Trade
Administration (ITA), and not less than $4.4 million for
ITA’s China Countervailing Duty Group.
•
Section 112 (125 Stat. 603) requires the Department of
Commerce to provide a monthly report on any official
travel to China by Department employees.
•
The Science Appropriations Act, 2012, Section 539 (125
Stat. 639), bars the National Aeronautics and Space
Administration and the Office of Science and
Technology Policy from using appropriated funds for any
participation, collaboration, or bilateral coordination
with China or any Chinese-owned company, unless such
activities are specifically authorized by a later law.
Section 539 also bars NASA from using appropriated
funds to host official Chinese visitors at NASA facilities.
The limitations do not apply in cases where NASA or
OSTP have certified in advance to the Committee on
Appropriations that the activities pose no risk of
resulting in the transfer of technology, data, or other
information with national security or economic security
implications to China or a Chinese-owned company.
H.R. 1473
4/15/2011 Department
of
•
Sec. 1340(a) and (b) (125 Stat. 123) bar the National
(P.L. 112-
Defense and Full-
Aeronautics and Space Administration and the Office of
10)
Year Continuing
Science and Technology Policy from using appropriated
Appropriations Act,
funds for any participation, collaboration, or bilateral
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2011 coordination
with China or any Chinese-owned
company, unless such activities are specifically
authorized by a later law. NASA is also barred from
using appropriated funds to host official Chinese visitors
at NASA facilities.
Source: Legislative Information System of the U.S. Congress
a. The North Korean Child Welfare Act of 2012 does not mention China by name, but is included in this table
because China borders North Korea and North Korean children and children of one North Korean parent
are known to live in China.
b. For all the current required elements of the Department of Defense’s Annual Report on Military and
Security Developments Involving the People’s Republic of China, see U.S. Code Title 10 Section 113 (10
USC § 113).
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Appendix C. Simple Resolutions Agreed to in
the 112th Congress
Table C-1. Simple Resolution Related to China
Agreed to in the House in the 112th Congress
Date
Resolution
Agreed
Number
to/Passed Title
Description
H.Res. 683
6/18/2012
Expressing the
Regrets the passage of legislation that adversely affected
regret of the House
people of Chinese origin in the United States because of
of Representatives
their ethnicity.
for the passage of
laws that adversely
States that nothing in this resolution may be construed
affected the Chinese or relied on to authorize or support any claim, including
in the United States,
but not limited to constitutionally based claims, claims
including the
for monetary compensation or claims for equitable relief
Chinese Exclusion
against the United States or any other party, or serve as
Act.
a settlement of any claim against the United States.
Source: Legislative Information System of the U.S. Congress.
Table C-2. Simple Resolutions Related to China
Agreed to in the Senate in the 112th Congress
Listed in reverse chronological order by date agreed to
Date
Resolution
Agreed
Number
To Title
Description
S.Res. 557
9/19/2012
A resolution
Honors the service of Lodi Gyaltsen Gyari as Special
honoring the
Envoy of His Holiness the Dalai Lama.
contributions of
Lodi Gyaltsen Gyari
Commends the achievements of Lodi Gyaltsen Gyari in
as Special Envoy of
building an international coalition of support for Tibet
His Holiness the
that recognizes: (1) the imperative to preserve Tibet’s
Dalai Lama and in
culture and religious traditions, and (2) that the Tibetan
promoting the
people are entitled under international law to their own
legitimate rights and
identity and autonomy within China.
aspirations of the
Acknowledges Lodi Gyaltsen Gyari's role, as a
Tibetan people.
naturalized U.S. citizen, in promoting understanding in
the United States of the Tibetan people, their culture and
religion, and their struggle for autonomy and human
rights.
Supports a political solution for Tibet within China that
satisfies the aspirations of the Tibetan people.
S.Res. 524
8/2/2012
A resolution
Reaffirms U.S. support for the 2002 declaration of
reaffirming the
conduct of parties in the South China Sea among the
strong support of
member states of the Association of Southeast Asian
the United States
Nations (ASEAN) and China.
for the 2002
declaration of
Urges all parties to exercise self-restraint in the conduct
conduct of parties in of activities that would complicate disputes and stability,
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Date
Resolution
Agreed
Number
To Title
Description
the South China Sea
including refraining from inhabiting presently uninhabited
among the member
islands, reefs, shoals, and other features.
states of ASEAN
and the People’s
Supports a diplomatic process by al claimants for
Republic of China,
resolving outstanding territorial and jurisdictional
and for other
disputes.
purposes.
Supports U.S. Armed Forces operations in the Western
Pacific, including in the South China Sea, in support of
freedom of navigation, the maintenance of peace, respect
for international law, and unimpeded lawful commerce.
S.Res. 476
6/7/2012
A resolution
Mourns the loss of Fang Lizhi and offers the Senate’s
honoring the
condolences to his family and friends.
contributions of the
late Fang Lizhi to
Honors the life, scientific contributions, and service of
the people of China
Fang Lizhi to the cause of human freedom.
and the cause of
Stands with the people of China as they strive to create a
freedom.
government that is democratic and respectful of human
rights.
S.Res. 356
3/29/2012
A resolution
Mourns the death of Tibetans who have self-immolated
expressing support
and deplores the repressive policies targeting Tibetans.
for the people of
Tibet
Calls on China to (1) suspend implementation of
religious control regulations and resume a dialogue with
Tibetan Buddhist leaders, including the Dalai Lama or his
representatives; and (2) release al persons who have
been arbitrarily detained and allow access by journalists,
foreign diplomats, and international organizations to
Tibet.
Commends the Dalai Lama for his decision to devolve his
political power in favor of a democratic system.
Congratulates Tibetans living in exile for holding, on
March 20, 2011, a free election that met international
electoral standards.
Reaffirms the friendship between the United States and
Tibet.
Calls on the Department of State to (1) fully implement
the Tibetan Policy Act of 2002, and (2) seek from China
a full accounting of the forcible removal of monks from
Kirti Monastery.
S.Res. 379
2/17/2012
An original
Expresses disappointment with the governments of the
resolution
Russian Federation and China for their veto of the U.N.
condemning
Security Council resolution condemning Bashar al-Assad
violence by the
and the violence in Syria and urges them to reconsider
Government of
their votes.
Syria against the
Syrian people
S.Res. 201
10/6/2011
A resolution
States that the Senate: (1) acknowledges that the
expressing the
framework of anti-Chinese legislation, including the
regret of the Senate
Chinese Exclusion Act, is incompatible with the basic
for the passage of
founding principles of equality recognized in the
discriminatory laws
Declaration of Independence; (2) regrets passing six
against the Chinese
decades of legislation targeting the Chinese people for
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Date
Resolution
Agreed
Number
To Title
Description
in America, including physical and political exclusion; and (3) reaffirms its
the Chinese
commitment to preserving the same civil rights and
Exclusion Act
constitutional protections for people of Chinese or other
Asian descent in the United States accorded to all
others.
States that nothing in this resolution may be construed
to authorize or support, or serve as a settlement of, any
claim against the United States.
S.Res. 217
6/27/2011
A resolution calling
Reaffirms the strong support of the United States for the
for a peaceful and
peaceful resolution of maritime territorial disputes in the
multilateral
South China Sea.
resolution to
maritime territorial
Deplores the use of force by China’s naval and maritime
disputes in
security vessels in the South China Sea
Southeast Asia
Calls on all parties to the territorial dispute to refrain
from threatening force or using force to assert territorial
claims.
Supports the continuation of operations by the U.S.
Armed Forces in support of freedom of navigation rights
in international waters and air space in the South China
Sea.
Source: Legislative Information System of the U.S. Congress.
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Appendix D. Hearings Related to China in the
112th Congress
Table D-1. House of Representatives Hearings
Related to China in the 112th Congress
Committee Print
Committee Hearing
Date Serial No.
Hearing Title
House Committee on
10/14/2011
H.A.S.C. 112-78
Nuclear Weapons
Armed Services
Modernization in Russia
Subcommittee on Strategic
and China: Understanding
Forces (HASC)
Impacts to the United
States
House Committee on
4/4/2011 112-31 The
American
Energy
Energy and Commerce
Initiative, Part 2: China’s
Subcommittee on Energy
Energy Portfolio and the
and Power
Implications for Jobs and
Energy Prices in the
United States
House Committee on
5/16/2011
112-126
Increasing Market Access
Financial Services
for U.S. Financial Firms in
Subcommittee on
China: Update on Progress
International Monetary
of the Strategic &
Policy and Trade
Economic Dialogue
House Committee on
1/19/2011
112-2
Assessing China’s Behavior
Foreign Affairs (HFAC)
and Its Impact on U.S.
Interests (Briefing)
HFAC full committee
6/16/2011
112-42
Why Taiwan Matters
HFAC full committee
10/4/2011
112-70
Why Taiwan Matters, Part
II
HFAC full committee
11/3/2011
112-85
Congressional-Executive
Commission on China:
2011 Annual Report
HFAC full committee
9/12/2012
112-178
Beijing as an Emerging
Power in the South China
Sea
HFAC Subcommittee on
5/13/2011
112-59
China’s Latest Crackdown
Africa, Global Health, and
on Dissent
Human Rights
HFAC Subcommittee on
9/22/2011
112-105
China’s One-Child Policy:
Africa, Global Health, and
The Government’s
Human Rights
Massive Crime Against
Women and Unborn
Babies
HFAC Subcommittee on
3/29/2012
112-138
Assessing China’s Role and
Africa, Global Health, and
Influence in Africa
Human Rights
HFAC Subcommittee on
7/9/2012
112-168
Continued Human Rights
Africa, Global Health, and
Attacks on Families in
Human Rights
China
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Committee Print
Committee Hearing
Date Serial No.
Hearing Title
HFAC Subcommittee on
3/31/2011
112-15
Asia Overview: Protecting
Asia and the Pacific
American Interests in
China and Asia
HFAC Subcommittee on
9/21/2011
112-63
China’s Monopoly on Rare
Asia and the Pacific
Earths: Implications for
U.S. Foreign and Security
Policy
HFAC Subcommittee on
11/15/2011
112-78
Feeding the Dragon:
Asia and the Pacific
Reevaluating U.S.
Development Assistance
to China
HFAC Subcommittee on
3/9/2011 112-5
China’s
Indigenous
Terrorism,
Innovation Trade and
Nonproliferation, and
Investment Policies: How
Trade
Great a Threat?
HFAC Subcommittee on
11/2/2011
112-74
Efforts to Transfer
Oversight and
America’s Leading Edge
Investigations
Science to China
HFAC Subcommittee on
3/28/2012
112-133
The Price of Public
Oversight and
Diplomacy with China
Investigations
Committee on the
11/2/2011 112-65
China
Democracy
Judiciary Subcommittee on
Promotion Act of 2011
Immigration Policy and
(H.R. 2121)
Enforcement
Committee on Ways and
10/25/2011
112-17
The U.S.-China Economic
Means
Relationship
Source: Committee prints published by the U.S. Government Printing Office and available at
http://www.gpo.gov.
Notes: Hearings listed are those specifically focused on China or Taiwan. China and Taiwan were referenced in
other hearings.
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Table D-2. Senate Hearings Related to China in the 112th Congress
Committee Print
Committee Hearing
Date
Serial Number
Hearing Title
Committee on Energy and
6/14/2012
S. Hrg. 112-623
Clean Energy Race: The
Natural Resources
United States and China
Committee on Foreign
5/26/2012
S. Hrg. 112-399
Nomination of Hon. Gary
Relations
Locke, of Washington, to
be Ambassador to the
People’s Republic of China
Committee on Foreign
11/1/2011
S. Hrg. 112-203
China’s Role in Africa:
Relations Subcommittee
Implications for U.S. Policy
on African Affairs
Committee on Foreign
9/20/2012
S. Hrg. 112-610
Maritime Territorial
Affairs Subcommittee on
Disputes and Sovereignty
East Asian and Pacific
Issues in Asia
Affairs
Source: Committee prints published by the U.S. Government Printing Office and available at
http://www.gpo.gov.
Notes: Hearings listed are those specifically focused on China or in which China was a leading topic. China was
referenced in other hearings. The Senate did not hold any hearings in the 112th Congress focused on Taiwan.
Author Contact Information
Susan V. Lawrence
Specialist in Asian Affairs
slawrence@crs.loc.gov, 7-2577
Congressional Research Service
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