WASHINGTON, June 8 -- U.S. business leaders, delighted over U.S. President Bill Clinton's decision two weeks ago to extend China's preferential trade status, spoke optimistically Wednesday of growth opportunities and investment plans in the nation of 1 billion people.
Clinton's controversial move drew the ire of human rights activists but brought applause from corporate America, and the praise kept gushing at the annual meeting of the U.S.-China Business Council.
Representatives of companies doing business in China attended what, because of its timing, amounted to a celebration in the wake of unconditional renewal of the most-favored-nation status that will keep Chinese trade taxes low.
Home and industrial equipment maker Honeywell Inc. has been in China since 1979, one of dozens of countries where the Minnesota-based firm maintains a presence, and the Clinton decision was music to the ears.
'We are very bullish on China,' Susan Rochford, an executive for Honeywell, said at a news briefing. 'It's our fastest-growing market in the world today.'
The huge communist nation has the fastest-growing economy on Earth, advancing 13.4 percent in 1993 as it adopts capitalist-style market reforms. Some analysts predict its economy may some day balloon into the world's largest.
U.S.-Chinese ties have been strained since Beijing's crackdown against pro-democracy dissidents during the June 1989 Tiananmen Square uprising.
The repression shocked the world and sparked human rights leaders to call on Washington to punish China by linking its treatment of dissidents to trade privileges.
Clinton's decision May 26, however, delinked human rights performance and trade dealings by renewing MFN status without conditions.
'We see the president's decision as a very important step toward an improved relationship with China,' said R. Michael Gadbaw, vice president and senior counsel for General Electric.
China Products North America Inc. has been doing business in China for more than two decades, starting up shortly after President Nixon's historic visit that reestablished U.S.-China relations. The import- export company breathed a sign of relief when Clinton made his announcement.
'We can make business plans for the future,' said Pam Myers Phipps, vice president of CPNA. 'Business relations develop best when there's an atmosphere of stability.'
CPNA ships products unique to China -- teas, spices, and down feathers, for instance -- into the United States. Without MFN status, duties on such imports could have ranged from 10 percent to 90 percent.
'Because of MFN (and the uncertainty over renewal), we didn't proceed with plans,' Myers Phipps said.
Shoemaker Nike has eight factories in China and expects to produce 25 million pairs of athletic footwear there in 1994, shipping the goods to the United States for sale in retail stores.
Under MFN, taxes, or tariffs, on Nike's shipments average 8.5 percent. If Clinton had struck down trade privileges, duties would have climbed to 35 percent, said Grant Hanson, general counsel for the Oregon-based company.
'That would have made it prohibitively expensive for Nike to make shoes in China for export to the United States,' Hanson said.
Robert Fraser, an executive for chemical and aerospace company Hercules Inc., said the chemical industry will accelerate investment in China because of Clinton's decision.
'Our company looks very positively on growth opportunities in China, ' he said.
