305. Summary of Conclusions of a Presidential Review Committee Meeting1
SUBJECT
- US–China Economic Relations
PARTICIPANTS
- State
- Richard Cooper (Under Secretary for Economic Affairs)
- Richard Holbrooke (Asst Sec for East Asian and Pacific Affairs)
- Treasury
- G. William Miller
- C. Fred Bergsten (Asst Sec, International Affairs)
- Defense
- David McGiffert (Asst Sec, International Security Affairs)
- Ellen Frost (Dep Asst Sec, International Economic and Technology Affairs)
- Commerce
- Homer Moyer (General Counsel)
- OMB
- John White
- Randy Jayne (Associate Director for National Security and International Affairs)
- JCS
- Lt. General John Pustay
- DCI
- John Holdridge (NIO for East Asia, Pacific and China)
- [name not declassified] (Office of Economic Research)
- IDCA
- David Bronheim (Associate Director for Policy and Budget)
- Jessica Einhorn (Dep Associate Director for Policy and Budget)
- White House
- David Aaron
- Ambassador Henry Owen
- Rona Freiberg
- NSC
- Roger W. Sullivan
SUMMARY OF CONCLUSIONS
Secretary Miller chaired the meeting, the purpose of which was to discuss the implications of a possible decision by the PRC to seek to take over the China seat this year in the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), and to consider if a way could be found consistent with our China policy to delay PRC entry until 1981.
The meeting agreed that if the PRC decides to claim the China seat, we should support that position. It is also in our long-term interest for a country as important as China to join the IMF and IBRD, assuming China will be willing to accept the obligation of membership. A serious effort by China to enter the institutions this year, however, could cripple our efforts to obtain Congressional approval of the FY 81 IFI legislation. There would be concern in the Congress over the prospect of large amounts of IDA funds going to China. The Taiwan issue would also be difficult involving questions of debt repayment, the form of possible continued participation by Taiwan in the institutions, and the disposition of the gold restitutions owed to “China”.
The meeting agreed that we could not actively discourage the PRC from entering the Bank and Fund without doing unacceptable damage to US–PRC relations. Secretary Miller, however, will meet with IBRD President McNamara to suggest that he defer his planned April trip to China and to seek to convince him that the entry of China into the Bank and Fund this year would not be in the interest of either the institutions or China. Secretary Miller will suggest instead that McNamara send a working group to China to explain the difficulties and to begin a [Page 1104] process of discussion on such issues as obligations of membership, debt repayment, disposition of gold restitutions, and a possible continuing association for Taiwan along the lines of the “Olympic model”.2 He will also seek to dissuade McNamara from sending a working group to Taiwan at this time to discuss the debt repayment question. If McNamara is unwilling to defer his trip, Secretary Miller will encourage him to explain to the Chinese why it would be in their interest to delay until next year before seeking to assume the China seat in the international financial institutions.
Treasury will coordinate with other pertinent agencies to develop talking points for Secretary Miller’s meeting with McNamara.
- Source: Carter Library, NSC Institutional Files (H-Files), Box 79, PRC 136, U.S.–China Economic Relations, 3/27/80. Confidential. The meeting took place in the White House Situation Room.↩
- Pursuant to its November 1979 Nagoya Resolution, the International Olympic Committee permitted Taiwan to continue participating in the Olympic Games if it made symbolic concessions to the People’s Republic of China in regard to the use of national symbols, such as abandoning the use of Taiwan’s name and flag. The IOC asked Taiwan to compete under a new name, “Chinese Taipei,” and use a new flag. Taiwan chose to boycott the 1980 summer and winter games, but did adopt the new name and flag in later Olympics. See also Document 296.↩