News

06 November 1997

TEXT: DAS KURT CAMPBELL 11/6 STATEMENT ON PLA COMMERCIAL ACTIVITY

(Engagement with China's military helps build trust)  (1800)



Washington -- Engagement with the People's Liberation Army (PLA) helps
foster "the mature, trusting military-to-military relationship
indicative of great powers -- one based on transparency and
reciprocity," according to Deputy Assistant Secretary of Defense Kurt
Campbell.


"Engaging China is an important component of our East Asia security
strategy," Campbell said in November 6 remarks before the Senate
Foreign Relations Committee. "Following the successful (Clinton-Jiang)
Summit, we must continue efforts to build a relationship for the 21st
Century and beyond, including the pursuit of military exchanges on a
fair and equitable basis. If we lack openness, transparency or
reciprocity, or if we hold back even routine information on our
military forces, then we will fail. We must remain engaged with China
in order to foster regional peace and stability."


According to Campbell, the PLA's business activity has been expanding
rapidly since the mid-1980s but the scope of PLA business activity in
the United States remains unclear. He noted that only two PLA firms
have been identified as conducting business in the United States.


However, Campbell stressed, "while we lack comprehensive information
on the full scope of PLA-operated firms in the United States, we make
every effort to address these concerns when engaging China's military
in an effort to make their role more transparent."


Following is the text of Campbell's remarks, as prepared for delivery:


(begin text)



STATEMENT OF DR. KURT CAMPBELL

DEPUTY ASSISTANT SECRETARY OF DEFENSE FOR ASIAN AND PACIFIC AFFAIRS

BEFORE THE SENATE FOREIGN RELATIONS COMMITTEE

NOVEMBER 6, 1997



Washington -- Good morning Mr. Chairman and Members of the Committee.
Thank you for this opportunity to speak to you about China. In the
interest of reserving time to answer any questions you may have, I
respectfully request that the following statement be entered into
record. I have prepared a brief statement that specifically addresses
your interest in PLA commercial activities.


I would like first to briefly outline our strategy in the Asia Pacific
region, how we view our relationship with China within that framework,
update you on developments in the military relationship post-summit,
and discuss PLA commercial activities in the United States.


As you know, Asia is changing at a dramatic pace and China is at the
forefront of this change. Our strategy is to help shape the direction
of China's evolution not only as a great economic actor but also as a
key contributor to regional and world stability. A future where China
has preserved its unique cultural heritage but is more open concerning
security matters, more open about its markets, and more respectful of
the rule of law, and human rights.


The one essential element in achieving the future we seek is the
expanded engagement of the United States throughout the region, such
as with the recently revised U.S.-Japan Security Guidelines. China too
is a beneficiary of the stable environment fostered by these
arrangements.


As you know, many of the economies of the region, China included, have
experienced robust growth over the last several years. One effect of
this growth has been a steady increase in defense budgets and force
modernization in the region. Many countries are acquiring new
capabilities. We believe that U.S. engagement in the region helps to
mitigate any fears which could arise because individual countries are
improving their military capabilities.


Strengthening the military-to-military dialogue with China is an
important part of the Administration's engagement policy. Over the
past year, substantial progress has been made toward regularizing
military dialogue. Since the visit of Minister of Defense Chi Haotian
in December 1996, a succession of visits, including the May 1997
Chairman of the joint Chiefs of Staff trip to Beijing and the August
1997 People's Liberation Army Chief of the General Staff visit to the
United States, has expanded and propelled our military ties to a new
level.


At the same time, a number of issues could impede further progress in
military-to-military relations. Of primary concern are China's
proliferation policies and practices. We have made significant
progress with China, especially in the nuclear non-proliferation area
but less on missiles and chemical weapons. We will continue our
efforts to bring China's practices in line with international norms."


We look for China to resolve disputes peacefully in accordance with
international norms; to be more transparent and open about military
affairs; and to stop the transfer of dangerous technologies to
unfriendly nations. China has gone from being a net oil exporter in
1994 to a net importer today. China's reliance on oil imports,
especially from the Persian Gulf, is projected to rise rapidly. This
growing demand should give China a strong economic interest in
stability in the Persian Gulf region.


The United States understands that these goals are best achieved
through constructive relations with China. That is why today the
United States is pursuing a strategy of engagement with China. Our
engagement strategy is this: "We will work with China where we can --
such as on the Korean Peninsula; and we will disagree where we must --
as we do with some of China's proliferation activities. I believe his
engagement strategy recognizes China for what it is -- an emerging
power, poised to either contribute to, or detract from, the tides of
economic dynamism, cooperation, and trust that are filling the Pacific
Basin.


No nation has benefited more from the regional stability provided by
America's engagement in the Asia Pacific than has China. Thus, none
should have a greater interest in our sustaining and revitalizing
those security structures that are the basis for the stability that
underlies the region's economic dynamism.


One purpose of Defense Secretary's visit to China this month is to
ensure that the progress made between Presidents Clinton and Jiang is
continued and, in that context, to build a foundation for preserving
security in the region well into the next century.


At this time, our two great nations are developing a better
understanding based on mutual respect. We must take advantage of our
warming relationship to strive for the next level. However, like all
worthy and worthwhile endeavors, there is much work to be done to
reach the next level in our relationship.


As part of our overall engagement strategy, we are building a
relationship with China's military. The PLA is a key player on the
core issues that concern us. These core issues form the three pillars
upon which U.S. regional security strategy is based: (1) engagement of
the PRC; (2) strong bilateral security arrangements with a U.S.
forward presence; and (3) prevention of the proliferation of nuclear,
biological, and chemical weapons (NBC) and their delivery systems.


Through our engagement of the PLA, we wish to develop the mature,
trusting military-to-military relationship indicative of great powers
-- one based on transparency and reciprocity. Our experience with
China in this area has been mixed and we continue to strive toward a
bilateral understanding on reciprocity and transparency that make our
military exchanges satisfying and meaningful for both sides.


We seek to understand, influence, and learn from the PLA. We seek to
increase mutual confidence and decrease miscalculation. That is why we
continually are engaging military personnel, have developed procedures
for U.S. Navy ship port calls to Hong Kong, and are pursuing common
understanding of "rules of the road" for our ships as they operate in
the same seas. That is also why we are engaging in high-level
strategic discussions.


At this point I want to address your concerns about PLA commercial
activities in the United States. As you are aware, the PLA's business
activity has been expanding rapidly since the mid-1980s; however, the
scope of PLA business activity in the United States is unclear. In
fact, we have identified only two firms which conduct business in the
U.S.. I think it is appropriate here to discuss the distinction
between enterprises operated by the PLA and those operated by the
defense industrial sector because the two are often confused.


China's defense industries are not subordinate to the PLA and no
trading companies run by the defense industries are owned, controlled,
or subsidized by the PLA. Moreover, defense industry revenues not
retained are remitted to other government organizations but not the
PLA. Nonetheless, the PLA and defense industries are affiliated in the
sense that the PLA is the primary customer for the defense industries
output of military hardware.


Let me be clear here. While we lack comprehensive information on the
full scope of PLA-operated firms in the United States, we make every
effort to address these concerns when engaging China's military in an
effort to make their role more transparent.


In this regard, the Summit produced several important Confidence
Building Measures, including the Military Maritime Safety Agreement
and our agreement for information sharing on disaster relief. While
these CBMs are good first steps, we need more substantive programs to
cement our relationship. For example, an agreement to conduct joint
humanitarian exercises in anticipation of cooperation in the event of
a natural disaster would be beneficial to our militaries and those
served in time of need.


We also need to develop a common vision for the Pacific Basin in the
21st Century. This common vision must advance a framework for regional
security strategy in which we both can participate and benefit from.
U.S. aims and objectives of our bilateral security arrangements are
not to stifle, or to limit, or to contain China. Rather these
arrangements are designed to provide a framework for peace and
stability which benefits all countries in the region, including China
and the United States.


Finally, we view China's participation in the development of this
framework for peace as vital. This is particularly true where we have
mutual interests, such as in Persian Gulf stability. We seek China's
cooperation to guarantee commercial access to the Persian Gulf for all
interested parties. We view China's restraint on NBC technology
transfer and other weapons proliferation as essential to the
maintenance of stability in the entire region.


In conclusion, engaging China is an important component of our East
Asia security strategy. Following the successful Summit, we must
continue efforts to build a relationship for the 21st Century and
beyond, including the pursuit of military exchanges on a fair and
equitable basis. If we lack openness, transparency or reciprocity, or
if we hold back even routine information on our military forces, then
we will fail. We must remain engaged with China in order to foster
regional peace and stability.


Thank you once again for the opportunity to address this topic today.
I'd be happy to answer any questions you have.


(end text)



 


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