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CNN Live Saturday

U.S.-China Trade Relationship a Lucrative One

Aired April 07, 2001 - 12:07   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
DONNA KELLEY, CNN ANCHOR: There is more than national pride at stake in the impasse with China. There are some globe-shaking economics involved. The United States and China major trading partners, and a wrong diplomatic move in Beijing or Washington could jeopardize billions of dollars in business.

For more insight into the economic implications of the standoff, we are joined by Gorge Koo, a director of the Committee of 100, which focuses on U.S.-Sino relations.

Good morning. We're glad you could join us. Thank you.

Good morning. Thank you.

KELLEY: You know, when we're talking about the attitudes now, we just had that report from Rebecca MacKinnon out of Beijing, and we showed some of the attitudes of folks on the street. They're mad, and they blame the United States. What's the overall attitude toward the United States in china currently?

GORGE KOO, COMMITTEE OF 100: Well, probably not very friendly, not very positive at this point. You can't blame them because from their point of view, the United States' plane came in to their shores and crashed with one of their pilots and one of their pilots is killed.

My observation has been that, you know, right now, the cooler heads are prevailing on both sides, and maybe we could have gotten there a little sooner if the hotheads on our side had right at the beginning taken a look at this whole incident from a shoe on the other foot approach.

KELLEY: As you say, but that's from their vantage point as they see it. But blame has not been placed yet, and there have been some reports that this Chinese pilot was a hot dog, as it's been phrased or a cowboy, and he had troubles before and documented in some pictures and that perhaps when blame gets placed, that it may not be the U.S. plane's fault and there are some in the United States who believe that China should have an apology to the United States.

KOO: Well, I'm not sure that blame is the important word here. I think, how do you resolve and reconcile, and what I'm saying is that if we had taken the shoe on the other foot approach -- suppose a reconnaissance plane from China had been off the coast of New Jersey when an American pilot crashed into it, and plunged into the ocean and he is killed.

At this point, which American politician, I ask you, would have enough statesmanlike quality to stand up and say, hey, according to international law, they should be able to get their people in 24 hours.

KELLEY: I think it's always important, and as you point out, to look at that time from both sides, and there are those to remind you, though, or the Chinese folks that this plane was in international waters and then came down in an emergency.

KOO: Well, I think you know, the best -- it's in the interest of people from both countries to let the professional diplomats quietly resolve this situation.

KELLEY: And that's what they're trying to do.

(CROSSTALK)

KELLEY: And that's what we hear, that there is progress and there is even some hope it could be done by the end of the weekend in some reports that I see. Let's talk about -- what's the difference between saying you regret something and it's an apology. Why is Beijing insisting that it should be an apology?

KOO: You know, I'm not a diplomat, and I think that there's a lot at stake in terms of each side -- the leaders on each side has to play to their own domestic audience, and so there's some -- you know, obviously some personal and domestic agenda involved in this, and if -- it's regrettable it sort of gotten out of hand initially. If it had been treated quietly, maybe it would have been easier to come to a resolution.

KELLEY: Let's talk about the trade relationship. This is huge. I have to tell you, Mr. Koo, I went through my child's, my youngest child's toy box, just for entertainment, just to see, because so many things are made in China now, and we brought in a couple of things, as did my executive producer, Kim. She brought in some of her dog's toys and a purse, an umbrella, a little ball, an Elmo sing-a-long book, here's a little, you know, Blues Clues electronic toy and Sesame Street, the whole shooting match. Everything you see here, and almost, I would say 75 percent, if not more, of my smallest child's toy box made in China.

KOO: Right, that's because in the last decade or so, China has emerged as one of the lowest cost and high quality production center, and you know, a lot of people in this country don't realize that we're talking about a Taiwan mainland conflict, but actually, half a million Taiwan professionals and managers live and work in mainland China.

KELLEY: Let's put up, while you're speaking, just let me put this up, from your group, the Group of 100, you say some of the top imported items, as you're telling us, toys, hardware, apparel, footwear, some automotive components, and low-end electronic products like battery chargers. Huge numbers, we're talking about, too. I mean, the trade deficit, from the latest numbers that we had earlier here at CNN, trade deficit with China grew 22 percent, reaching 83.3 billion dollars.

KOO: Well, a couple comments on the trade deficit figure. First of all, whenever there is trade, there's a buyer and a seller, it's got to be a good deal for both parties before a deal gets done. So, we're getting low-cost goods over here at a -- at a low price that we're willing to pay.

That's number one. So, you know, trade is not a good deal for only one party, it's good for both parties. The other thing about trade deficit that it depends on the way it is counted. The way we count the trade coming in versus the way China counts the trade going out is different.

For example, a pair of shoes...

KELLEY: We're out of time, Mr. Koo. But I just wanted to let you make that point, that trade is a huge, huge issue between China and the United States.

That's right.

KELLEY: All right, George Koo...

KOO: Thank you.

KELLEY: ... who is a Committee of 100, thank you so much for coming to talk with us. We appreciate it.

KOO: Thank you.

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