Friday, February 23, 2007

[IWS] CRS: China-U.S. Relations: Current Issues and Implications for U.S. Policy [14 February 2007]

IWS Documented News Service
_______________________________
Institute for Workplace Studies----------------- Professor Samuel B. Bacharach
School of Industrial & Labor Relations
-------- Director, Institute for Workplace Studies
Cornell University
16 East 34th Street, 4th floor
---------------------- Stuart Basefsky
New York, NY 10016
-------------------------------Director, IWS News Bureau
________________________________________________________________________

Congressional Research Service (CRS)
Order Code RL33877

China-U.S. Relations: Current Issues and Implications for U.S. Policy
February 14, 2007
Kerry Dumbaugh, Specialist in Asian Affairs, Foreign Affairs, Defense, and Trade Division
http://www.opencrs.com/rpts/RL33877_20070214.pdf
[full-text, 35 pages]

Summary
U.S.-China relations have remained remarkably smooth since late 2001,
although there are signs that U.S. policy toward China is now subject to competing
reassessments. State Department officials in 2005 unveiled what they said was a new
policy framework for the relationship — one in which the United States was willing
to work cooperatively with a non-democratic China while encouraging Beijing to
become a "responsible stakeholder" in the global system — and U.S. Treasury
Secretary Henry Paulson in December 2006 established a U.S.-China Strategic
Economic Dialogue with Beijing, the most senior regular dialogue yet held with
China. Other U.S. policymakers appear to have adopted tougher stances on issues
involving China and U.S.-China relations, concerned about the impact of the PRC's
strong economic growth and a more assertive PRC diplomacy in the international
arena. A matter of growing U.S. concern is China's increasing global "reach" and
the consequences that the PRC's expanding international influence has for U.S.
interests. To feed its appetite for resources, China has been steadily signing trade
agreements, oil and gas contracts, scientific cooperation agreements, and multilateral
security arrangements with countries around the world, some of which are key U.S.
allies. Some U.S. observers view these activities as, at best challenges, and at worst,
threats, to the United States.

Taiwan, which China considers a "renegade province," remains the most
sensitive issue the two countries face and the one many observers fear could lead to
Sino-U.S. conflict. But U.S. relations with Taiwan have also been plagued by what
some U.S. officials see as that government's minimal military spending and its
failure to enact funding bills that allow it to purchase U.S. weapons offered for sale
in 2001.

Much U.S. concern about China appears driven by security calculations at the
Pentagon and in Congress. Pentagon officials question the motivations behind
China's expanding military budget. A congressionally mandated DOD report
concluded Beijing is greatly understating its military expenditures and is developing
anti-satellite (ASAT) systems ­ a claim that gained more credence when the PRC
used a ballistic missile to destroy one of its own orbiting satellites in early January
2007. Bilateral economic and trade issues also remain matters of concern, with U.S.
officials and some Members of Congress particularly criticizing China's failure to
halt piracy of U.S. intellectual property rights (IPR) and China's continued
constraints on its currency valuation.

This report will be updated regularly as events warrant and will track legislative
initiatives involving China. The 109th Congress considered these and other issues in
a number of legislative vehicles, including The John Warner National Defense
Authorization Act for FY2007 (P.L. 109-364), and S. 295, a bill to authorize punitive
action if China's currency is not re-evaluated. For actions and issues in U.S.-China
relations during the 109th Congress, see CRS Report RL32804, China-U.S. Relations
in the 109th Congress, by Kerry Dumbaugh.

Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background and Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Current Issues and Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
PRC Anti-Satellite Test . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Economic and Trade Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Intellectual Property Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Currency Valuation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
North Korea . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
October 2006 Nuclear Test . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Six Party Talks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
U.S.-PRC "Senior Dialogue" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Taiwan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
U.S. Taiwan Policy and U.S. Arms Sales . . . . . . . . . . . . . . . . . . . . . . . 9
Corruption Scandals in the Chen Administration . . . . . . . . . . . . . . . . . 9
Changing PRC Political Pressure on Taiwan . . . . . . . . . . . . . . . . . . . . . 9
Taiwan and the World Health Organization (WHO) . . . . . . . . . . . . . . 10
Official Taiwan-PRC Contacts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
China's Growing Global Reach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
European Union . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Middle East and Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Western Hemisphere . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
China and Environmental Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
National Security Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Annual Report on China's Military Power . . . . . . . . . . . . . . . . . . . . . 18
Weapons Proliferation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Military Contacts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Human Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
New Internet and Media Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Religious Freedom . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Tibet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Xinjiang's Ethnic Muslims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Family Planning Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Social Stability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Hong Kong Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
U.S. Policy Implications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Major Legislation in the 110th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Chronology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Appendix I: Selected Visits by U.S. and PRC Officials . . . . . . . . . . . . . . . . . . . 30
Appendix II: Selected U.S. Government Reporting Requirements . . . . . . . . . . . 31
______________________________
This information is provided to subscribers, friends, faculty, students and alumni of the School of Industrial & Labor Relations (ILR). It is a service of the Institute for Workplace Studies (IWS) in New York City. Stuart Basefsky is responsible for the selection of the contents which is intended to keep researchers, companies, workers, and governments aware of the latest information related to ILR disciplines as it becomes available for the purposes of research, understanding and debate. The content does not reflect the opinions or positions of Cornell University, the School of Industrial & Labor Relations, or that of Mr. Basefsky and should not be construed as such. The service is unique in that it provides the original source documentation, via links, behind the news and research of the day. Use of the information provided is unrestricted. However, it is requested that users acknowledge that the information was found via the IWS Documented News Service.

****************************************
Stuart Basefsky
Director, IWS News Bureau
Institute for Workplace Studies
Cornell/ILR School
16 E. 34th Street, 4th Floor
New York, NY 10016

Telephone: (607) 255-2703
Fax: (607) 255-9641
E-mail: smb6@cornell.edu
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