Statement of the Government of the People's Republic of China re- garding normalization of relations, January 1, 1979__. Presidential memorandum, "Relations with the People on Taiwan,' Text of speech by Secretary of State Vance to the Executive Officers Appendix-Continued Text of a speech by Ambassador Leonard Woodcock at a reception given by the Chinese People's Friendship Association with foreign countries to mark the establishment of diplomatic relations between the United States of America and the People's Republic of China, January 9, 1979. Korea is bound to achieve its independent and peaceful reunification, reprinted from the Peking Review, No. 7, February 17, 1978__‒‒ Doing Business with China, an Overseas Business Report prepared by the PRC Affairs Division Office of East-West Country Affairs of Department of Commerce, November 1976 China perceived: An analysis of the official reports of congressional Chronology of Sino-American relations_ Page 68 69 71 117 135 139 RECOMMENDATIONS TAIWAN 1. Our insistence on a peaceful resolution of Taiwan should remain an essential element in our new relationship with China and the people of Taiwan. Recognition of the communist regime in China does not, of course, imply approval of that Government's policies, as many Americans seem to think. It does indicate a recognition that the PRC is the government actually in charge. Reunification is an issue that the Chinese themselves must decide, since they both insist there is but "One China and that Taiwan is a part of that China." The United States, however, has a moral obligation to insure that the Taiwanese people are able to freely choose their future without intimidation. TRADE 2. Although there is a danger that false euphoria regarding trade with China will exist, greater Sino-American trade can help to marginally reduce the U.S. trade deficit. Increases in mutual trade will be gradual. However, to maximize trade potential, early actions to resolve frozen claims and assets (assuming a satisfactory Chinese offer) and the signing of a Trade Agreement are desirable. These are partially symbollic actions, but they are also important to insure that American firms have equally competitive opportunities in China. KOREA 3. In light of our altered relationship with China, the Department of State should pursue the reduction of tensions on the Korean peninsula with the Chinese. Korea remains the most heavily armed, tense flash point in Asia and it is in the interest of all parties to reduce the danger of war. U.S. DIPLOMACY 4. Having established a triangular diplomatic balance between. China, the Soviet Union and the United States, we must be careful not to "tilt" toward either communist power. ARMS SALES 5. It is not in our national interest to sell military arms or technology to China. However, the United States should help aid in the modernization of the Chinese economy and help to maintain their sense of security indirectly by our continued military presence in the Western Pacific. EXCHANGE PROGRAMS 6. Public and private organizations should explore new areas of common interests between the Chinese and American people. For example, Chinese performing artists indicated to me their eagerness for resumption of cultural exchanges, increased educational exchanges and further enlargement of scientific exchanges are all desirable. INTRODUCTION AND SUMMARY Although China is the world's oldest society, the People's Republic of China is the youngest state among the major international actors. Thus, it is still evolving and recent changes inside the PRC are significant. These changes and the establishment of diplomatic relations between the United States and China mark a new turn in SinoAmerican relations. China is important, but America's principal foreign policy focus in Asia must remain Japan. Vice Premier Teng Hsiao-p'ing agrees and said the Japanese-American relations are more important than Sino-American relations. He has, of course, told the Japanese the same thing. Yet, China remains a major regional actor with an influence on the global scene. It is also important that we not expect that "better" relations with China will eliminate all sources of friction. Adversarial relations wax and wane and a prudent foreign policy recognizes this fact. Just as in the past, Chinese concerns center over security, economic modernization, territorial integrity, and her degree of dependency on foreign nations. These concerns naturally reflect China's greatest asset and simultaneously the greatest liability-one billion people in a backward economic state. This report reviews the threats perceived to Chinese security and the gradual diminution of fears of an immenent attack. China's prospects for economic modernization are discussed and potential bottlenecks to the achievement of that goal are spelled out. With U.S. recognition of the end of the Chinese civil war and agreement on a de jure definition of territorial integrity regarding Taiwan, only the unsettled question of Chinese claims on Soviet territory and the all important U.S. emphasis that force not be used to resolve the Taiwan issue remain as major territorial issues. Traditional xenophobia is evident as the Chinese leadership debates the specific terms in the acquisition of foreign technology and the opening of China to foreign influences. But, the violent, chauvinistic impulses of the Cultural Revolution have given way to a rational examination of Chinese problems and pragmatic attempts to cope with these long standing problems. With respect to Taiwan, it is obvious that Chinese sovereignty is important to the PRC. However, in Chinese history, autonomy has often been the practice. For example, after the Ming dynasty fell in 1644, Taiwan was autonomous for four decades. Vice Premier Teng told us directly that after PRC legal sovereignty was recognized Taiwan could (1) maintain its own separate economic and social system; (2) maintain its own armed forces despite the status of being a province of China; and (3) that force would |