U.S., China Settle One Trade Dispute, Launch Into Another

BEIJING —  U.S. Trade Representative Mickey Kantor on Saturday signed an agreement to settle one trade dispute with China and immediately jumped into the middle of another one.

Kantor and his Chinese counterpart, Wu Yi, signed a pact settling an acrimonious 20-month dispute over the protection of intellectual property rights. But even before they inked the deal, they started bickering over the implementation of a 1992 accord to open China’s markets to more U.S. products.

Wu accused the United States of failing to live up to a 1992 memorandum of understanding, which she said committed the United States to supporting China’s application to the new World Trade Organization. She said China would retaliate.

“We have a saying in China: Courtesy demands reciprocity,” said Wu, minister of foreign trade and economic cooperation.

Kantor said that if China failed to fully live up to the 1992 agreement, it would trigger a new threat of U.S. trade sanctions. He also urged China to reopen talks on gaining admission to the World Trade Organization. “The ball is in China’s court,” Kantor said.

At the center of the dispute lies China’s desire to become a founding member of the World Trade Organization, which replaces the old General Agreement on Tariffs and Trade.

But the United States and other major trading nations said China had failed to fulfill the requirements of membership.

In the 1992 pact, China agreed to lift import controls, license requirements and quotas on nearly 3,000 kinds of products over a period of several years. China was supposed to lift 155 quotas and controls last year, but it did not complete its obligation, U.S. officials said.

Instead, China in January notified the United States that it was suspending the agreement. Products affected include hard woods, grain, tobacco, beer, wine, computers and some heavy machinery.

U.S. officials disputed Wu’s claim that the United States broke its word on China’s admission to the WTO, saying Washington only agreed to try to hammer out a protocol that would satisfy WTO requirements.