ISSUE BRIEF NUMBER IB75085
George D. Holliday
John P. Hardt
Senior Specialist Division
THE LIBRARY OF CONGRESS
CONGRESSIONAL RESEARCH SERVICE
MAJOR ISSUES SYSTEM
DATE ORIGINATED 12/15/75
DATE UPDATED 11/19/81
FOR ADDITIONAL INFORMATION CALL 287-5700
The improved political relationship between the United States and the
People's Republic of China (P.R.C.), initiated by the Nixon Administration
and furthered by the Carter Administration's decision to establish diplomatic
relations, has spurred a rapid increase in Sino-U.S. trade.
small relative to overall U.S. foreign trade, the volume of trade represents
an abrupt shift from the no-trade policy that had been pursued since 1950.
Despite the rapid expansion, outstanding issues remain as serious barriers to
normalized trade. Resolution of those issues may require concession or
accommodations by the Chinese leadership as well as action by both the U.S.
Congress and the Executive Branch.
However, the development of a new
approach to foreign economic relations by the post-Mao Chinese leadership and
the establishment of diplomatic relations have laid the ground work for a
further expansion of commercial relations.
BACKGROUND AND POLICY ANALYSIS
With the P.R.C.'s entry into the Korean War in 1950, Sino-U.S. trade
virtually ceased. While the volume of trade between the two countries had
never been large, the United States had accounted for a significant portion
of Chinal's foreign trade during the first half of the Twentieth Century.
the early 1930s, the United States had become China's second largest trade
partner, accounting in some years for over 20% of China's total trade
This trading relationship continued immediately
Communist takeover in 1949. In 1950, the Communists' first full year in
power, two-way trade amounted to $191 million, 22.5% of China's total trade.
As a result of the Korean War, the Truman Administration took several
steps first to restrict and then to end commercial ties with the P.R.C.
most important of these was a total embargo on U.S. exports to t h e P.R.C.,
declared in December 1950 under the authority of the Export Control Act of
1949. At the same time, the Secretary of the Treasury, acting under the
authority of the Trading With the Enemy Act of 1917, issued the Foreign
Assets Control Regulation, which blocked Chinese assets in the United States
and placed a total embargo on imports from China. The cessation of trade was
reinforced by Transportation Orders T-1 and T-2, issued pursuant to the
Defense Production Act of 1950, which prohibited U.S.-flag air or sea
carriers from carrying any cargo destined for the P.R.C.
Bunkering in the
United States of vessels calling at Mainland Chinese ports was also
prohibited. On December 29, 1950, shortly after the U.S. actions, the P.R.C.
Government issued a decree in which it assumed control over all U.S.
property in China.
In subsequent years additional legal barriers to Sino-U.S. trade were
erected. The most important of these were denial of most-favored-nation
treatment (MFN) to imports from the P.R.C. and a prohibition on U.S.
Export-Import Bank financing of U.S.-P.R.C.
The denial of MFN
treatment was first included in the Trade Agreements Extension Act of 1951.
The prohibition on Eximbank participation in trade with the P.R.C. and other
Communist countries was first enacted in the Foreign Assistance and Related
Agencies Appropriations Act of 1964. Both measures were continued by various
iaws until 1975, when they were modified by the Trade Act of 1974 (P.L.
93-618) and the Export-Import Bank Amendments (P.L. 93-646) of 1974. The new
laws condition the grant of MFN to non-market economy countries and their
eligibility for U.S. Government credits on liberalization of restrictive
emigration policies. MFN treatment is also conditioned on conclusisn of a
bilateral trade agreement.
The new restrictions embodied in the Trade Act and the Export-Import Bank
Amendments came several, years after the Nixon Administration had taken the
first steps to remove barriers to U.S.-P.R.C.
From July 1969 to
February 1972, a number of important
administration of commercial relations with the P.R.C. were made. Among the
changes were the following:
Restrictions on travel to the P.R.C.
by U.S. citizens were relaxed;
foreign subsidiaries and affiliates of U.S. firms were permitted to trade in
nonstrategic goods with the P.R.C.
Bunkering of ships from non-Communist countries carrying non-strategic
aoods to the P.R.C. was allowed: controls were removed on the use of dollars
h d dollar instrumentalities in'transactions with the P.R.C.
U.S. carriers were permitted to transport goods authorized for consignment
to the P.R.C. to non-P.R.C. ports; the embargo on exports to the P.R.CI
ended, and the P.R.C. was accorded the same treatment for export control
purposes as the Soviet Union and some East European countries.
In February 1972, President Nixon made an offical visit to the P.R.C.
the end of his visit, he and the Chinese leadership issued the Shanghai
Communique which formalized the new political relationship between the two
countries. With regard to commercial relations, the Communique states: "Both
sides view bilateral trade as another area from which mutual benefits can be
derived and agree that economic relations based on equality and mutual
benefit are in the interest of the peoples of the two countries."
Additional steps in the normalization of commercial relations followed.
In November 1972, U.S. regulations were further modified to allow U.S.
carriers and ships to visit P.R.C. ports. A trip by Secretary of State Henry
Kissinger to the P.R.C. in February 1973 resulted in the establishment of
"Liaison Offices" in Peking and Washington.
In May 1973, the National
Council for U.S.-China Trade, a trade promotional organization composed of
representatives from private business, was established with the encouragement
of the Administration. The Carter Administration's decision to establish
diplomatic relations with the P.R.C. announced on Dec. 15, 1978, removed
probably the major barrier to normalization of commercial relations.
LEVEL OF TRADE
The improved political relationship and the
restrictions resulted in a dramatic increase in the volume of bilateral
trade, the value of which i ncrease d from nea r zero i n 1970 to over $900
million in 1974. Total 1978 trade turnover was approx imately $1.1 billion.
The rapid expans i on reflect s both inflationsrY effects and real increases in
the volume of trade.
(In millions of U.S. dollars)
U.S. Exports to
U.S. imports from
Until 1976 the United States accumulated large surpluses in its balance of
trade with the P.R.C. This resulted, in large part, from the P.R.C.'s
to import a considerable volume of U.S. agricultural products -- primarily
wheat, cotton, soybeans, and corn. Agricultural exports accounted for over
80% of U.S. exports to the P.R.C. in 1972, 1973, and 1974.
In 1975, U.S.
grain exports to the P.R.C. fell significantly, with the result that overall
trade turnover was cut in half. The U.S. trade deficits with China in 1976
and 1977 were also largely the result of a reduction in grain sales.
1978, the P.R.C. again began to import significant amounts of U.S. wheat,
and, in 1980, the United States became the leading supplier of wheat to
China. The large increase in two-way trade in 1978 also reflected an
expansion of non-agricultural trade. The major non-agricultural exports have
been aircraft and aircraft parts, oil-processing equipment, iron and steel
products, aluminum and other non-ferrous metals, and chemicals.
In addition, the P.R.C. has signed contracts with a U.S.
firm for eight
entire ammonia plants valued at more than $200 million. By far the largest
transaction is an agreement with U.S. Steel Corporation, signed in January
1979, to build a billion-dollar iron ore processing complex in China.
automotive firms are negotiating possible ventures involving production of
trucks and heavy-duty transportation equipment which may be even larger.'
Of the small
Since then, the
volume of P.R.C. exports to the United States, the most
have been cotton textiles, and tin.
In 1974, the United
84.6 million square yards of textiles and apparel from China.
rapid growth has continued; in the first 10 months of 1978
imports totaled almost 180 million square yards valued at $118 million.
China is now the sixth largest supplier of textiles to the United States.
The rapid increase in imports from China led some industry spokesmen to
demand import restrictions.
AGREEMENT ON PRIVATE CLAIMS
Since the establishment of diplomatic relations, U.S. and
representatives have been intensively negotiating the outstanding legal and
administrative barriers to trade. One of the major issues was the question
of blocked Chinese assets and private U.S. claims against the Chinese
Government, which had been a serious impediment to shipping, banking, and
other aspects of commercial relations. (U.S. private claims against China
were estimated to be $197 million, while blocked Chinese assets in the United
States were valued at $76.5 million.) In 1973 Secretary of State William
Rogers met with P.R.C Foreign Minister Chi Peng-fei in Paris to negotiate a
settlement. They agreed in principle to a resolution, but no settlement was
reached. In May 1977, it was reported that the Carter Administration had
resumed negotiation on the claims issue. During a visit to China in March
1979, Secretary of Treasury Michael Blumenthal initialed an agreement with
the Chinese Government.
The agreement was officially signed during a
subsequent visit to China by Secretary of Commerce Juanita Kreps in May 1979.
The agreement provides that the Chinese Government will pay U.S.
$80.5 million by Oct. 1 1984 ($30 million of that total is to be paid by Oct.
1, 1979). The U.S. Government agreed to unfreeze $80.5 million of Chinese
assets held in U.S. banks.
However, at the insistence of the U.S.
negotiators, the agreement does not take any position as to the ownership of
the Chinese assets.
Consequently, the Chinese may have difficulty in
reclaiming some of their assets.
Another important barrier was the absence of most-favored-nation (MFN)
treatment for Chinese exports to the United States. The Trade Act of 1974
prohibits extension of MFN to non-market economy countries that restrict
emigration. The President may waive the requirement of free emigration for
18 months with Congressional approval, if he receives assurances that the
waiver will promote free emigration. This procedure has been followed to
extend MFN treatment to Romania and Hungary.
The absence of MFN had a
negative effect on the P.R.C.'s ability to export to the United States.
seems likely that the political significance of MFN is a more important
consideration for them than potential economic gains. During her visit to
China in May 1979, Secretary Kreps initialed a general bilateral trade
agreement --- an important provision of which is extension of MFN to China.
The agreement was officially signed on July 7, 1979.
On Oct. 23, 1979, President Carter submitted the bilateral trade agreement
to Congress and used his waiver authority to extend MFN treatment to China.
A concurrent resolution (H.Con.Res. 204) to approve the extension of MFN was
passed by Congress on Jan. 24, 1980.
The Carter and Reagan Aaministrations have taken several steps to relax
controis on exports to the P.R.C. On Apr. 25, 1980, the Commerce Department
placed China in a separate category for export control purposes, according
different treatment for exports to China than for exports to the Soviet Union
and most other communist countries.
On Sept. 12, 1980, the Commerce
Department announced new, less stringent licensing guidelines for the P.R.C.
The new guidelines permit approval of some exports with military end-uses.
On JuIY 8 , 1981, the Reagan Administrat ion announced a liberalized export
policy on dual- use, hi gh technology expor ts to the P.R.C.
Deputy A ssistant Secre tary of Commerce for Ex port Administration Bo Denysyk,
the pol icy wi 11 red uce administrative re strictions
presumpt ion of approva 1 for products wi th technical levels twice those
previous ly aPPr oved " The Administration lat er announced the availability of
Project licenses expedite the
"project licenses" for exports to China.
export 1 icensin g proce ss by providing appr ova 1 for U.S. assisted projects in
China wh ich involve eq uipment and technolo9Y requiring validated licenses.
Export Credits and Investment Guarantees
Until recently, the Chinese leadership did not show the same interest in
credits as other Communist countries.
However, in recent years, Chinese
leaders have moderated their policy of avoiding long-term indebtedness to
foreigners and have accepted some "deferred payments1*--short-and medium-term
credits--for purchase of complete plants. The Agricultural Trade Act of 1978
(P.L. 95-501) was passed by the 95th Congress and signed by President Carter.
Among other provisions, the Act makes the P.R.C.
eligible for three-year
agricultural credits from the Commodity Credit Corporation.
Chinese eligibility for U.S. Eximbank credits was not provided for in the
bilateral trade agreement signed on July 7, 1979.
Mondale, during his Aug. 1979 visit to China pledged Administration support
for an effort to make Eximbank credit assistance available to the P.R.C.
Subsequently, in April 1980, President Carter determined that it is in the
national interest for Eximbank to extend export credits to China.
Until recently, the P.R.C. Government followed a very restrictive approach
to any kind of foreign involvement, such as foreign investment or industrial
cooperation, in the Chinese economy.
Foreign businessmen and technicians
were allowed to visit industrial projects only rarely. This policy appears
to be changing. Foreigners are traveling to China in greater numbers, and
official Chinese statements suggest that foreign direct investments will be
allowed. If the Chinese government is willing to accept private direct
investment by foreigners, U.S. firms may be assisted by the Overseas Private
Investment Corporation (OPIC), a U.S. Government agency which insures U.S.
investors overseas against political risks. Two bills (H.R. 5252 and S.
1916) were introduced in the 96th Congress which would allow OPIC to insure
U.S. foreign investments in China. The bills were subsequently passed, and
President Carter signed the measure into law (P.L. 96-327) on Aug. 8, 1980.
OTHER BILATERAL AGREEMENTS
On Jan. 22, 1979, representatives of the U.S. and Chinese governments met
in Washington, D.C. to discuss textile trade.
Subsequently, the textiles
issue was discusse6 by the two governments on several occasions.
officials pressured the Chinese to sign an oreerly marketing agreement (i.e.,
quantitative restrictions) on imports of Chinese textiles. In the absence of
an agreement, the U.S. government unilaterally imposed a quota on Chinese
textile imports. After prolonged negotiations the two sides finally reached
agreement on the terms of an agreement. On July 24, 1980, the U.S. Trade
Representative's office announced that an agreement in principle had been
initialed. The agreement was formally signed in Washington, D.C. on Sept.
17, 1980. The agreement, which is effective from Jan. 1, 1980 to Dee. 31,
1982, provides for the orderly import of Chinese textile and apparel products
made of cotton, wool, and synthetic fibers.
Three other bilateral agreements were signed on Sept. 17, 1980: A civil
aviation agreement provides for regularly scheduled direct commercial flights
between the United States and China; A maritime agreement provides for port
access and cargo sharing; And, a consular agreement authorizes both countries
to open three more consulates.
In October 1980, Representatives of the two countries signed a 4-yeas
grain supply agreement. The agreement, which came into effect Jan. 1, 1981,
provides for the sale of between 6 million and 9 million metric tons (mmt) of
grain annually. Purchases by China above 9 mmt require the approval of the
CHINESE TRADE POLICY AND PROSPECTS FOR FUTURE TRADE
Political issues have played an important role in China's foreign trade
For example, there is evidence that Chinese importers
discriminated against countries with which China has not had good diplomatic
relations. In ,particular, the United States appears to have been a market of
last resort in Chinese grain purchases.
This policy suggests that the
establishment of diplomatic relations between the United States and China may
be followed by a significant increase in bilateral trade.
Chinese domestic politics have been an important determinant of the level
of foreign trade and will probably heavily influence the course
U.S.-Chinese trade. Before his death, Premier Chou En-lai and his chief
administrator on economic affairs, Vice-premier Teng Hsiao-ping, promoted a
program to rapidly modernize the Chinese economy. Their program, consisting
of an intensive drive to modernize Chinese agriculture, industry, national
defense, and science and technology, was designed to make China a modern
industrial power by the year 2000.
modernization drive emphasized expanded production through hard work and
stricter managerial authority, increased attention to the living standards of
workers, and the systematic import of technology to from abroad.
deaths of Chou En-lai and Mao Tse-tung, this program became a prominent issue
in the succession struggle. The radical faction in the Chinese leadership,
led by the so-called "Gang of Four," denounced the use of material
incentives, the diminution of the Party's role in the economy and dependence
on foreign technology. In September 1976, the leaders of the radical faction
were arrested. The ascent to power of the moderate faction, led by Premier
Hua Kuo-feng and Teng Hsio-ping, was followed by renewed emphasis on economic
A key element of the modernization program
is an expansion of Chinese
foreign trade. Major emphasis is being placed on the import of equipment and
technologies for oil exploration, coal mining, steelmaking, electronics,
chemical fertilizer, power generation, and the petrochemical industry. Other
imports include grain, crop seed, farm animals for breed-stock, and small
amounts of consumer goods.
A review of economic ~erformance in 1979 convinced Chinese economic
planners that their modernization drive was proceeding too rapidly, and that
available resources would not support the massive capital construction
projects that were underway. Consequently, they decided to retrench somewhat
from the ambi tious modernization program and proceed more cautiously.
result of thi s decision was a temporary suspension of some import contracts
signed wi th Japanese firms and a slowdown of commercial negotiations with
other foreign companies.
U.S. firms wishing to do business with the P.R.C.
face many practical
problems because of their general unfamiliarity with Chinese foreign trade
This is complicated by the P.R.C.'s isolation
international economic system.
There are few opportunities for Western
businessmen to contact Chinese exporters and importers; business contacts
have been limited primarily to the Canton Trade Fair, held twice a year.
Recently, this situation has been changing. For example, a number of U.S.
business executives have visited Peking to conduct negotiations on sales of
oil exploration and drilling equipment, minerals and metal processing
equipment, and petrochemical machinery and technology. American technicians
were involved in the installation of the ammonia plants.
Even with the removal of major political and legal barriers, there are
serious economic constraints on the P.R.C.'s ability to e x ~ a n d rapidly its
volume of trade with the United States. The most ii~ortant-const
raint is the
P.R.C.'s increasing difficulty in earn ing suf fic ientLhard curr ency to pay for
its import needs. Export growt h is un likely to keep pace w i th the import
needs implied by China's modern ization program and its peri odic need for
grain imports. The gap between export potential and impor t needs provides a
strong motivation for Chinese a cceptance of more trade credits
Moreover, in the long-run, increases in U.S. high-technology exports to
the P.R.C. may be offset by a smaller volume of agricultural exports.
allocating their scarce hard-currency reserves, Chinese planners
probably show preference to industrial imports, while placing emphasis on
developing self-sufficiency in agriculture.
Naturally, a reduction of
agricultural imports depends on the P.R.C.'s ability to expand rapidly
domestic agricultural production.
Recent fluctuations in domestic grain
production attest to the difficulty of achieving this goal in the short run.
Nevertheless, the long-run Chinese goal appears to be to avoid the kind of
large purchases of agricultural products that inflated U.S.-P.R.C.
totals in some recent years.
One bright spot in the P.R.C.'s foreign trade situation is the potential
for large exports of oil. The P.R.C.'s proven plus probable reserves are
conservatively estimated at 5.9 billion metric tons and could easily be 7.6
billion metric tons.
Offshore reserves will add appreciably to these
estimates. Production has expanded rapidly during the 1970s, and, by 1985,
the P.R.C. could be producing in excess of 200 million metric tons. Thus, in
the future, the P.R.C.'s earnings from oil exports could ease its balance of
payments constraint. To realize its potential as a major oil exporter, the
will probably have to import considerable amounts of Western
machinery, equipment and technology.
The P.R.C. also has reserves of other raw materials, such as natural gas,
coal, and iron, which could provide large exportable surpluses in the future.
However, the development of those resources and the establishment of
sufficient processing and transportation facilities appear to be a longer
In making decisions affecting U.S.-P.R.C.
consider a number of important questions:
trade, U.S. policymakers
Is the P.R.C. a potentially attractive source for U.S. imports of oil
other raw materials?
Should the P.R.C. be treated differently from the Soviet Union in U.S.
foreign trade policy, particularly in relation to official credits and
D o high-technology exports to
represent 'a threat
Will occasional Chinese agricultural purchases have a destabilizing effect
on domestic supplies and prices?
Are U.S. trade concessions likely to be an effective means for influencing
domestic political stability and the process of succession in China?
Can the United States use trade to influence great power relations in East
Would U.S. export of high-technology to the PRC have a stabilizing
destabilizing impact on the Northeast Asian balance of power?
What commercial benefits might accrue to the United States as a result
more liberal trade policies toward the PRC?
Congress. House. Committee on Banking, Finance and Urban
Affairs. Subcommittee on International Trade, Investment
and Monetary Policy. Export-Import Bank and Trade with
China. Hearings, 95th Congress, 2d session, on H.R. 8196.
Jan. 26, 1978. Washington, U.S. Govt. Print. Off., 1978.
Amending the Export-Import Bank Act of 1945 with respect to
credit to communist countries. Hearings, 96th Congress,
1st session, on H.R. 1908. July 23 and 24, 1979. Washington,
U.S. Govt. Print. Off., 1979. 121 p.
Committee on International
Relations. Subcommittee on Asian and Pacific Affairs.
Normalization of relations with the People's Republic
of China: practical implications. Hearings, 95th
Congress, 1st session. Sept. 20, 21, 28, 299 and
Oct. 11, 13, 1977. Washington, U.S. Govt. Print.
Off., 1977. 394 p.
Committee on Ways and Means.
Subcommittee on Trade.
States-China Trade Agreement. Hearings, 96th Congress, 1st
session. Nov. 1, 2, and 29, 1979. Washington, U.S. Govt.
Print. Off., 1980. 344 p.
----- Joint Economic Committee Subcommittee on Priorities
and Economy in Government. Allocation of resources in the Soviet
Union and China-1977. Hearings, 95th Congress, 1st session.
June 30, 1977. Washington, U.S. Govt. Print. Off., 1977.
Congress. Senate. Committee on Agriculture, Nutrition,
and Forestry. Subcommittee on Foreign Agricultural Policy.
Agricultural Trade with the People's Republic of China
and Taiwan. Hearing, 96th Congress, 1st session.
Mar. 13, 1979. Washington, U.S. Govt. Print. Off., 1979.
Congress. Senate. Committee on Banking, Housing and Urban
Affairs. Amending the Export-Import Bank Act and the
Trade Act. Hearings, 96th Congress, 1st session. July 12
and 19, 1979. Washington, U.S. Govt. Print. Off., 1979. 183 p.
Congress. Senate. Committee on Commerce. American role
in East-West trade. Hearings, 94th Congress, 1st and 2d
sessions. Dec. 11-12, 1975 and Jan. 30 and Feb. 4 , 1976.
----- Committee on Finance. Subcommittee on International
Trade. Agreement on Trade Relations between the United
States and the People's Republic of China. Hearing, 96th
Congress, 1st session. Nov. 15, 1979., Washington,
U.S. Govt. Print. Off., 1980. 156 p.
Committee on Foreign Relations. S. 1916. Hearing, 96th
Congress, 2nd session. March 3, 1980. Washington, U.S.
Govt. Print. Off., 1980. 32 p ,
Washington, U.S. Govt. Print. Off., 1977. 209 p.
REPORTS AND CONGRESSIONAL DOCUMENTS
Conuress. House. China: one steo further toward normalization.
A reGort by Carl Albert and John ~hodes. Washington,
U.S. Govt. Print. Off.. Julv 1975. 10 D.
94th Congress, 1st session. House. -~ocumentno. 94-255.
Congress. House. Impressions of the new China. Joint report
to the United States House of Representatives by Hale Boggs
and Gerald R. Ford on their mission to the People's Republic
of China, June 23 to July 7, 1972. Washington, U.S. Govt. Print.
Off., 1972. 27 p.
92d Congress, 2d session. House Document no. 92-337.
Ninth Congressional delegation to the People's Republic of
China, Aug. 17-30, 1975. Washington, U.S. Govt. Print. Off.,
June 8, 1976. 32 p.
94th Congress, 2d session.
Committee on Ways and Means.
from the President of the United States transmitting a
proclamation extending nondiscrimanatory trade treatment to
the products of the People's Republic of China, together
with related reports, pursuant to Section 407 of the Trade
Act of 1974. Washington, U.S. Govt. Print. Off., 1979.
96th Congress, 1st session. House Document No. 96-209.
Special report to the Congress and the East-West Foreign
Trade Board on Implications for U.S. trade of granting
most-favored-nation treatment to the People's Republic
~f China. Submitted to the Congress by the Chairman,
U.S. International Trade Commission. Washington, U.S.
Govt. Print. Off., June 8 , 1977. 105 p.
95th Congress, 1st session.
Congress. Joint Economic Committee. China and the Chinese.
Washington, U.S. Govt. Print. Off., Nov. 19, 1976. 139 p.
(At head of title: 94th Congress, 2d session Joint Committee
Chinese economy post-Mao. Washington, U.S. Govt. Print.
Off. Nov. 9, 1978. 880 p.
(At head of title: 95th Congress, 2d session. Joint Committee
Congress. Senate. China report. Report of a special congressional
delegation. Washington, U.S. Govt. Print. Off., July 1973. 13 p.
93d Congress, 1st session. Senate. Document no. 93-43.
Congress. Senate. Journey to the new China, April-May 1972.
Reports of Mike Mansfield and Hugh Scott. Washington,
U.S. Govt. Print. Off., 1972. 31 p.
92d Congress, 2d session. Senate Document no. 92-89.
Congress. Senate. Committee on Armed Services. China and
American policy. Report by Henry M. Jackson. Washington,
U.S. Govt. Print. Off., Aug. 1974. 5 p.
At head of title: 93d Congress, 2d session. Committee print.
Congress. Senate. Committee on Commerce. American role
in East-West trade. Washington, U.S. Govt. Print. Off.,
Feb. 1977. 145 p.
(95th Congress, 1st session. Committee print.)
Committee on Finance. Extension of nondiscriminatory treatment
to products of the People's Republic of China. Report to
accompany S.Con.Res. 47. Washington, U.S. Govt. Print. Off.,
Jan. 10, 1980. 13 p.
(At head of title: 96th Congress, 2d session, Report No.
Congress. Senate.' Committee on Foreign Relations. China:
a quarter century after the founding of the People's Republic.
A report by Senator Mike Mansfield. Washington, U.S. Govt.
Print. Off., Jan. 1975. 31 p.
(At head of title: 94th Congress, 1st session. Committee
Congress. Senate. Committee on Foreign Relations. Subcommittee
on Multinationsl Corporations. Western investment in Communist
economies: a selected survey on economic interdependence [ b y ]
John P. Hardt, George D. Holliday, and Young C. Kim. Washington,
U.S. Govt. Print. Off., 1974. 83 p.
At head of title: Committee print.
Congress. Senate. Foreign Relations Committee and House
International Relations Committee. The United States and China.
A report by the Seventh Congressional Delegation to the People's
Republic of China. Washington, U.S. Govt. Print. Off.,
Oct. 28, 1975. 68 p.
At head of title: 94th Congress, 1st session. Joint Committee
CHRONOLOGY OF EVENTS
President Carter signed P.L. 96-327, which makes available
to U.S. investors in China the insurance programs of the
Overseas Private Investment Corporation.
The U.S. Trade Representative's office announced that an
agreement in principle had been signed with China which would
limit imports of Chinese textiles.
H.Con.Res. 204, approving extension of MFN for China
was passed by Congress.
President Carter sent to Congress a proclamation
extending most-favored-nation treatment (MFN) to
China. The extension of MFN must be approved by
U.S. and Chinese representatives signed a bilateral
trade agreement in Peking.
President Carter announced the establishment of
diplomatic relations with the P.R.C.
Vice President Mondale visited China and pledged
that the Administration would submit the U.S.-Chinese
trade agreement for Congressional approval by the end
08/26/77 -- Secretary of State Cyrus Vance made an
official visit to the P.R.C.
06/22/77 -- President Carter signed the Export Administration
Amendments of 1977.
05/01/77 -- The New York Times reported that U.S.-P.R.C.
negotiations to settle financial claims between
the two countries had resumed.
Diplomats in Peking reported that China's fifth five-year
plan would begin early in 1977.
The death of Chairman Mao was announced officially
04/07/76 -- Hua Kuo-fen9 was promoted to Prime Minister and first
chairman of the Communist Party.
China's Premier Chou En-Pai died,
President Ford began a visit to the P.R.C.
Secretary of Agriculture Earl Butz said that the P.R.C.'s
cancellation of wheat orders from the United States was
probably due to a good domestic wheat crop in China and
an unfavorable foreign exchange situation.
The P.R.C. cancelled an order for 601,000 tons of U.S. wheat.
Secretary of State Henry Kissinger began his seventh
visit to the P.R.C.
President Ford named George Bush to head the U.S.
Liaison Office in Peking.
Senator Mike Mansfield introduced S. 3285, a bill to extend
most-favored-nation treatment to the P.R.C.
P.L. 93-22 enacted authorizing the President to extend
diplomatic privileges and immunities to the Liasion Office
sf the People's Republic of China.
Secretary of State William Rogers announced "an agreement
on principle" on question of frozen Chinese assets in the
United States and private U.S. claims against the P.R.C.
The U.S. and the P.R.C. agreed to open "liaison offices."
President Nixon lifted a 22-year ban on travel by U.S.
aircraft and ships to China.
The Boeing Corporation announced that it had received an
export license to sell $150 million in commercial jets to
A Chinese foreign trade mission, after visiting various
parts of the United States, met with President Ford and
Trade Act of 1974 (P.L. 93-618) was enacted.
02/14/72 -- President Nixon further relaxed controls on U.S. exports to
the P.R.C., giving it equal treatment with regard to export
controls to the Soviet Union and various East European
President Nixon visited the People's Republic of China.
President Nixon announced a relaxation of the embargo on
trade with the P.R.C. Specific items of a non-strategic
nature were permitted for export to the P.R.C. without a
validated license. Other measures were announced to
facilitate travel by Chinese citizens to the United States
and shipping between the two countries.
Foreign subsidiaries of U.S.-owned firms permitted to
engage in trade of non-strategic items with the P.R.C.
Department of State announced relaxation of restrictions
on travel by U.S. citizens to the P.R.C.
ADDITIONAL REFERENCE SOURCES
Hsiao, Gene T. The foreign trade of China: policy,
law, and practice. Berkeley, University of California
Press, 1977. 291 p.
Central Intelligence Agency. China:
1977-78. December 1978. 23 p.
Department of Commerce. Industry and Trade ~dministration.
Prospects for PRC hard currency trade through 1985. Prepared
by Gary R. Teske, Medija H. Kravalis and Allen J. Lenz.
Jan. 12, 1979. 21 p.