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U.S. Department of State
96/05/10 Remarks on Asia-Pacific Region before the Business Council
Office of the Spokesman
U.S. DEPARTMENT OF STATE
Office of the Spokesman
Text As Delivered May 10, 1996
SECRETARY OF STATE WARREN CHRISTOPHER
THE BUSINESS COUNCIL
May 10, 1996
Thank you for that kind introduction. I want to thank Ed Woolard
and John Bryan for their invitation to appear before the Business
Council, which has done so much to deepen the dialogue between business
and government. And it is a great honor to be on the program with
Senior Minister Lee Kwan Yew of Singapore, my distinguished predecessor
Henry Kissinger, my former Carter Administration colleague Zbig
Brzezinski, and Treasury Secretary Robert Rubin. Appearing in this
company before this powerful audience is enough to make me look forward
to another relaxing round of Middle East shuttle diplomacy.
I am particularly pleased to have the chance to speak with you
about the dynamic Asia-Pacific region. As a young naval officer in the
Pacific in World War II, chairman of a Los Angeles-based law firm with
Asian offices, a one-time trade negotiator with Japan, and now Secretary
of State, I have had the opportunity to witness -- up close and personal
-- many of Asia's remarkable changes over the last half-century.
With all due respect to the proponents of a coming "Asian
Century," I am bold enough to believe that it will also be the second
American Century as well. As a global power with global interests, the
United States has a great stake in the region's dynamism, and we have
the greatest ability to sustain it in ways that benefit the American
people and the world.
Let me make a few observations about the impact of this new era on
the way in which we pursue our national interests:
First, accelerated change means that no company or country can
take its leadership for granted. The United States won the Cold War,
but as Peter Drucker has written, no company -- or country -- is
automatically destined to be a permanent economic superpower in the new
global marketplace. We have to keep on our toes and be light on our
Second, one of the most dramatic changes I have seen is the
erasure of the line between domestic and foreign policy -- just as in
the corporate world you no longer see a bright line between a company's
domestic and foreign operations. The Clinton Administration recognizes
that our strength at home and abroad are inseparable -- and that our
ability to create jobs and growth here depends on our ability to open
markets overseas. I believe that one of the signature accomplishments
of our Administration will be a landmark set of market-opening
agreements -- from GATT and NAFTA to APEC and the Free Trade Agreement
of the Americas.
Third, our economic diplomacy is not only essential to advancing
our commercial interests but is also a powerful tool for achieving other
core foreign policy goals. Economic development is essential to
undergird peace, stability and progress toward democracy -- whether in
the Middle East, Haiti, or the Newly Independent States of the former
Soviet Union. Just as surely as our military might and our embassies
overseas advance our interests, your companies' global presence extends
American power and influence. Our late and much-admired colleague Ron
Brown understood this concept well, and we will certainly all miss him
for that and many other reasons.
Nowhere is the mutually reinforcing relationship between our
economic and security interests more apparent than in the Asia-Pacific
region. For the last half-century, America's military presence in Asia
has provided the foundation of stability for nations to build thriving
economies for the benefit of all.
There should be absolutely no doubt that we intend to remain a
Pacific power. During the last three years, President Clinton has taken
a number of key strategic decisions to reinforce our engagement in the
region -- through our five active security alliances, our forward-
deployed presence, and our commitment to maintain approximately 100,000
troops in the Pacific.
The cornerstone of our engagement in the region, of course,
remains our relationship with Japan. Here as elsewhere, this
Administration has defied the skeptics and demonstrated that we can
promote America's economic interests while strengthening our vital
security relationships at the same time.
The Joint Declaration signed by the President and Prime Minister
Hashimoto in Tokyo last month provides the firm foundation to ensure
that our alliance can meet the challenges of the next century. Japan
has agreed to increase its financial and material support for our troops
stationed there. In addition, we are working well with Japan in areas
such as Bosnia and the Middle East.
Our economic relationship with Japan is also becoming more
balanced. Since 1993, U.S. exports to Japan have risen by 34 percent,
with increases as high as 80 percent in the sectors where trade
agreements have been reached. Our trade deficit fell last year by
almost 10 percent from its level in 1994 -- the first time since 1990
that our bilateral trade deficit has decreased.
This progress is due to a variety of factors -- including the
persistent efforts of your companies to gain footholds in Japanese
markets. But there can be no doubt that it is also due to our
determined efforts to open markets. Over the last three years, we have
reached 21 separate market access agreements with Japan in sectors as
diverse as autos and auto parts, agriculture, telecommunications and
medical technology. We will be vigilant in ensuring the implementation
of existing agreements -- and in resolving outstanding trade disputes in
areas such as film, semiconductors and insurance. And we will press
for further deregulation of Japan's economy, which will benefit Japanese
consumers as well as American and other foreign businesses.
Of course, no nation is playing a larger role in shaping the
future of Asia than China. How our relationship with China develops
will have a vast impact on our future. Nobody should have any illusions
about the difficulty of dealing with this emerging power during a time
of transition. But nobody should have any doubt about how important a
stable, open and prosperous China is to our interests. What is vital is
keeping a clear eye on our strategic interest in moving China in that
direction. Your companies' capital, technology and ideas are already
playing a critical role in integrating China into the mainstream of the
global economy and the international community.
The United States shares an array of important interests with
China -- and we have worked hard over the last three years to advance
them. I have met with my counterpart Vice Premier and Foreign Minister
Qian Qichen 13 times since I became Secretary of State. We have been
able to work together to extend the Nuclear Non-Proliferation Treaty,
and to resolve the threat posed by the North Korean nuclear program. We
have engaged with China in our effort to ban nuclear testing, to fight
drug trafficking and alien smuggling and to protect the environment.
When we have problems with China's actions, we have pressed our
interests candidly and forcefully. As you know, we have stressed to
China the importance of fully implementing the agreement on protecting
intellectual property rights that we concluded in March 1995. The
piracy of CD's, videos, and software is growing, causing billions of
dollars in losses to American companies. The President has made it
clear that if the Chinese do not deal with this IPR piracy, we will have
no choice but to go ahead with a carefully targeted but quite
substantial list of sanctions provided for by U.S. law.
We will continue to pursue our interests vigorously, whether the
issue is security, trade, non-proliferation or human rights. Last month,
for example, we sent an unmistakable signal to China that the use of
force across the Taiwan Strait would be a matter of grave concern to the
But we reject the counsel of those who seek to contain or isolate
China. Far from protecting our interests, such a course would harm
It is in this broad context that we will be supporting the
continuation of MFN for China once again next month. The President and
I will make the case that the case that the best way to advance our
interests is to maintain our engagement -- an approach pursued by six
presidents and now endorsed, I am pleased to note, by Senator Dole.
Revoking or conditioning MFN now would not advance human rights in
China. But it would damage our economy -- and harm Hong Kong and
Taiwan, and other Asian allies and friends. That is why Hong Kong
legislative leader Martin Lee and Governor Chris Patten, with whom I met
yesterday morning, support MFN's unconditional renewal.
Our alliance with South Korea is also another vital relationship.
During the last three years, we have developed an unprecedented degree
of cooperation. Our strong partnership enabled us to forge an agreement
to freeze North Korea's dangerous nuclear program and put it on course
for dismantlement. We have also made great commercial progress in what
is now our fifth largest export market. We expanded our exports last
year by 40 percent -- and now have a trade surplus.
As you know, to reach a durable peace on the Peninsula, President
Clinton and President Kim Young Sam recently offered a proposal for
four-party talks among the United States, South Korea, North Korea and
China. China has said that the proposal is "reasonable" and that it
will participate if North Korea does. North Korea, for its part, has
indicated that it is seriously studying the proposal.
The nations of ASEAN -- Singapore, Indonesia, Malaysia, Thailand,
the Philippines, Brunei, and now Vietnam -- are essential to our
security and economic interests in Asia. Their rapidly growing markets
collectively represent our fourth largest trading partner. We are
working hard in Southeast Asia to protect intellectual property rights,
promote U.S. investment, and expand U.S. exports, which rose by more
than 10 percent in 1994.
Like any other region, the Asia-Pacific region has its share of
problems that make the business environment difficult. As Secretary,
one of my top priorities has been to fight the corrupt practices that I
know cost American companies billions of dollars in orders and contracts
every year. In late 1993, I launched a global initiative through the
OECD to unite supplier nations to end illicit payments. I am delighted
that we have reached agreement to prevent bribes paid to foreign
officials from being tax-deductible as a business expense. I hope they
will soon be outlawed altogether. In a parallel effort, I have also
intensified our efforts through APEC to increase the transparency of
bidding practices in government procurement in this region -- where as
you know there will be such massive demand over the next two decades.
During the last three years, this Administration has placed an
unprecedented emphasis on our interlocking strategic and economic
interests in Asia and around the world. We will continue to work with
you to seize the opportunities that Asia has to offer -- opportunities
that are so critical to America's future.
Thank you very much.
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