54. Telegram From the Liaison Office in China to the Department of State1

1216. Subj: Jackson Bill and PRC.

While I realize that overriding concern with Jackson Bill limiting President’s authority to grant MFN treatment is centered on Soviet Union and its restrictions on Jewish emigration, I would like to call attention to fact that, if passed in present form, bill will apply equally to PRC and will be a major obstacle to developing U.S.–PRC trade relations. I am particularly concerned that members of Congress may not be fully aware of importance Peking attaches to MFN, both as a prerequisite for expanding its exports to the U.S. and thereby improving balance of trade and politically as a significant indicator of further progress in normalization of relations.
Recent discussion between Hong Kong ConGen officers and Senator Jackson’s staff assistant, Richard N. Perle, (as reported to us by visiting FSO John J. Taylor) suggests ignorance in some congressional quarters of consequences for Sino-U.S. relations if free emigration imposed as condition for MFN. In describing Senator Jackson’s views on this subject, Mr. Perle assumed that China would not be concerned over failure to receive MFN status. When the problems were pointed out to Mr. Perle, he had no response except to offer the hope that somehow the issue would not be raised. He made clear that the proposed legislation was aimed solely at the USSR.
In addition to difficulties posed for Sino-U.S. trade, Jackson Bill will also raise political problem of a public finding that PRC practices emigration policies making it subject to provisions of the bill. Given Chinese sensitivities on question of refugees and emigration this cannot help but have negative impact on our developing relations.
I realize fully that question of MFN for the PRC inevitably bound up with that of Soviet Union. Nevertheless, I think it important—and possibly useful in Soviet context as well—that Congress be made aware of significance which PRC attaches to this question and possible adverse impact Jackson Bill could have on U.S.–PRC commercial and political relations. Perhaps some additional educational efforts with the Congress might be useful.
  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Kissinger Office Files, Box 93, Country Files, Far East, China Trade and Exchanges, July 5, 1973–Feb. 28, 1974. Confidential; Nodis; Cherokee. No time of transmission appears on the telegram; however a stamped notation indicates it was received at 9:04 p.m.