CHINA'S Trade Ministry yesterday expressed its concern at the re-introduction of a Bill in the United States Congress attaching conditions to the renewal of its Most Favoured Nation (MFN) trading status and stressed that Beijing would ''never accept'' conditional renewal. ''Of course, we are concerned at this development,'' a ministry spokesman said. ''Unconditional MFN is the cornerstone of the Sino-US trade relations. China can never accept the unilateral attachment of conditions by the US to the renewal of MFN.'' Asked what Beijing would do if the Bill - sponsored by Senate Democratic Leader George Mitchell and California Democrat Congresswomen Nancy Pelosi - was signed by President Bill Clinton, the spokesman said the authorities would take ''appropriate action''. He refused to specify what that action might entail. China has previously responded to US threats of unilateral trade action with its own threats of retaliatory measures against American exports. ''The US would publish a US$4 billion hit-list and Beijing would counter with a US$4.1 billion list of its own,'' a Western diplomat said. ''But this time it's different, China can hardly respond by attaching conditions to renewal of MFN for the US,'' he said. The Bill, similar to the first version of the Pelosi Bill vetoed by Mr George Bush last year, seeks to tie the renewal of China's MFN to human rights and trade conditions. It also includes a requirement that China adhere to the Sino-British Joint Declaration on the future of Hongkong. Hongkong General Chamber of Commerce director Ian Christie yesterday warned that Beijing could react angrily if the US linked the Joint Declaration with MFN. Mr Christie said the announcement of the new Bill came as something of a surprise. He had been assured three weeks ago when meeting with Democratic Congressmen in the US that they would allow Mr Clinton time to formulate his foreign trade policy before putting him under pressure on China's MFN status. ''It is in all our interests that dialogue continues between the United States and China and that MFN status is extended without clauses,'' he said. The Hongkong Government has estimated that up to 46,000 jobs, or 2.1 per cent of the territory's labour force, would be lost in the immediate term should MFN status not be extended beyond June 3, 1994. Hongkong would lose US$4.7 billion to $6.3 billion worth of re-export business in addition to a six to eight per cent decrease in overall trade. Mr Chris Jackson, Hongkong's deputy director-general of trade, said: ''Conditioning MFN is a high-risk strategy. They should not link politics with trade. ''The Bill creates uncertainty in the economy and jeopardises Hongkong and United States interests both here and in China.'' The Trade Department is to lead another delegation of Hongkong businessmen to Washington in early May to lobby senators and congressmen. The Democratic Alliance for Betterment of Hongkong this week wrote to the US Senate Foreign Relations Committee urging it to exercise its best endeavours to persuade the Clinton administration and fellow senators not to politicise the extension of China's MFN status. ''Political issues should be resolved by diplomatic means,'' the letter said. ''It is unwise to mix economic and political issues.'' Should the Bill be passed, most analysts said Beijing would probably respond by threatening to block US investment in key industrial areas and major infrastructure projects. ''I think you will see a lot of public denunciations of the US administration's action and dark threats of retaliation but very little in the way of concrete action,'' a US business executive in Beijing said yesterday. ''The Chinese Government knows that even if conditions are attached there is still very little chance of MFN being revoked next year,'' he said. ''Everybody knows it is in both sides' interest to keep things as they are,'' he added. Mr Clinton must decide by June on renewing MFN, which is reviewed on a year-to-year basis. His predecessor, Mr Bush, repeatedly sustained MFN despite attempts on Capitol Hill to overrule him. Governor Chris Patten, who goes to Washington next month, warned US politicians on Wednesday against trying to link MFN renewal with his push to extend democracy in Hongkong. A delegation from the American Chamber of Commerce in Hongkong is to lobby the White House and Congress in Washington next week for unconditional MFN renewal.
