Joint Press Conference of President Clinton and Premier Zhu Rongji of the People's Republic of China, 1999

Presidential Hall

3:57 P.M. EDT
             
         THE PRESIDENT:  Good afternoon.  Please be seated. 
Premier Zhu and members of the Chinese delegation, I want to thank
you again for coming to the United States.  It is important for the
leaders of America and China to meet regularly.
        
         Today we were able to make progress in areas that
benefit both the American and Chinese people.  We had the chance to
speak directly and openly on matters where we have disagreements.  We
reviewed our ongoing efforts to enhance the security of both our
nations, and to build world peace and stability -- in our efforts to
seek peace on the Korean Peninsula, to work with India and Pakistan
to curb their nuclear competition, to join in adherence to
international agreements limiting the spread of weapons of mass
destruction.

         In that regard, let me say I hope that both our nations
soon will ratify the Comprehensive Test Ban Treaty to end all nuclear
testing.
        
         We also discussed our common efforts to increase
prosperity for both our nations.  Economic is Premier Zhu's primary
portfolio.  With his leadership, China's economy has withstood Asia's
financial turmoil and helped to mitigate its impact on other nations
in the region.  Now, with Asia's recovery underway, but regional
growth still fragile, Premier Zhu has been squarely addressing
China's toughest economic challenges -- reforming state-owned
industries and financial institutions, rooting out corruption,
bringing China into the Information Age, and expanding international
trade.  These efforts will benefit China and its trading partners,
including America's businesses, workers and farmers.

         Our nations also will benefit from new cooperative
initiatives we have agreed upon in recent days -- to develop a
private housing market in China; to create a U.S.-China dialogue on
job training and labor rights; to support clean energy projects in
China.  Today we will sign a civil aviation agreement that will
double passenger and cargo flights between our countries, bringing
jobs and economic activity to both. 
        
         And after extensive efforts by our negotiators, China
has agreed to direct all its government agencies to use only licensed
computer software, which will greatly assist our software industry in
China, now the world's fifth-largest personal computer market. 
Additionally, we have reached an important agreement that will open
China's markets for U.S. exports of citrus, meat products, and
Pacific Northwest wheat, all highly important for our farmers.

         I am also pleased we have made significant progress
toward bringing China into the World Trade Organization on fair
commercial terms, although we are not quite there yet.  A fair

WTO agreement will go far toward leveling the playing field for our
companies and our workers in China's markets; will commit China to
play by the rules of the international trading system, and bring
China fully into that system in a way that will bring greater
opportunity for its citizens and its industries as well.

         Today, we are issuing a joint statement recording the
significant progress we have made on WTO and committing to work to
resolve all remaining issues this year.

         Ultimately, to succeed in the market-based,
information-driven world economy, China must continue its efforts
toward reform.  Premier Zhu has worked very hard on them.  There is
still work to be done, and we want to support China in its efforts to
strengthen its legal system, impose stronger labor and environmental
protections, improve accountability, give citizens greater freedom
and increase their access to information.

         We disagree, of course, on the meaning and reach of
human rights, because I am convinced that greater freedom, debate and
openness are vital to improving China's citizens' lives as well as
China's economy over the long run.  It is troubling that in the past
year, China has taken some steps backwards on human rights and
arresting people basically for seeking to express their political
views.  I also regret that more progress has not been made to open a
dialogue with the Dalai Lama. 
        
         We honor China's remarkable achievements, its greater
prosperity and the greater range of personal choices available to its
citizens, as well as the movement toward local democracy.  We
appreciate the magnitude of its struggles, far greater than those
faced by any other country in the world.  But the American people
and, indeed, people all around the world, believe that all persons
are entitled to fundamental freedoms that include freedom of speech,
religion and association. 
        
         I hope that China's leaders will conclude that in these
areas, too, benefits of change outweigh the risks.  I hope and
believe we can make the kind of progress together that will enable
both of us to have the kind of strong partnership that would be very
much in the world's interest in the 21st century -- a partnership
against war and terrorism, against dangerous weapons and crime, far
better health care and education, for a cleaner environment,
achievements in the arts and the sciences, a deepening of democratic
values and prosperity for all our citizens and indeed, for all the
world.
        
         I have no illusions that cooperation with China can
resolve all of our differences.  Our countries are too large, our
backgrounds are too different.  Where our interests diverge, we will
continue to stand for our values and to protect our national
security.  But a policy of confrontation for confrontation's sake, as
I said yesterday, will accomplish nothing but the fulfillment of the
bleakest prophesies held by people in both the United States and
China.
        
         Yesterday I said we should not see this relationship
through rose-colored glasses, nor should we see it through a glass
darkly.  We should see it with clear eyes.  It is in the interest of
the American people and the Chinese people that whenever we can
cooperate, we should.  This relationship, complex though it may be,
is profoundly important to the future of every American and every
Chinese citizens, and indeed, to all the world.
        
         Premier Zhu.
   
         PREMIER ZHU:  Thank you.  Ladies and gentlemen, I'd like
to thank President Clinton for his invitation, and now the delegation
of the People's Republic of China is visiting the

United States.  And today I'm very honored to join President Clinton,
to meet all the friends coming from the press.  And I am ready to
convey through the friends from the media my most sincere greetings
and best regards to the American people.

         From the moment since I set foot on the American soil,
which started from Los Angeles -- when maybe God did not welcome me
very much, for it rained very hard -- but it appears to me that the
American people like me.  And today, we received a very grand welcome
from the President and we had a very good talk with the President and
his colleagues.  And at noon, I also attended a very grand luncheon
hosted by Secretary Albright, which was an opportunity for me to meet
many old friends.

         I believe that our talks were frank and candid, and they
were constructive and fruitful.  Naturally, the result has not been
measured by how many agreements we may have reached -- I believe
we've already reached quite a number of agreements.  What is the key
that the PRC delegation is able to have the opportunity of meeting
people from different walks of life in the United States and that we
can have an opportunity to talk directly to the American people to
explain to them what is our views.

         As I said in the morning, it is not that only friends
who say yes to you are good friends; we believe that maybe the
friends who are able to say no to you are the best friends for you. 
        
         And from Washington, I will also travel to Denver, to
Chicago, to New York and to Boston where I will meet quite a lot of
friends from the United States.  I'm ready to talk to them, and I'm
also prepared to argue, to debate with them.  I believe by doing so,
we will be able to promote the communication and mutual understanding
between our two peoples, thus promoting the relationship between us
-- or, rather, the objectives of working to build a constructive
strategic partnership between the two sides as opened up by the two
Presidents, and also to continue to develop the friendship between
us.

         As the President said earlier this morning, we also
reached certain agreements on the WTO question, and we shall issue a
joint statement.  On this question and also on these areas we've
already agreed upon, such as on the agricultural questions, we will
sign certain agreements.  In my view, all these will further promote
the development of friendship and cooperation between China and the
United States. 
        
         And today I am ready to answer your questions in a very
candid manner.  But as the Premier of China, I took my office only on
the 17th of March last year, and today is my first time to experience
such press conference -- so my heart is now beating.  (Laughter.) 
I'm not as experienced as the President, because the President is
very experienced in dealing with you.  (Laughter.)  I'm not that
experienced, so should I say something which is not appropriate very
much, I do hope that you will exercise certain leniency and try to
promote what is good and try as much as you can to cover what may not
be that appropriate.  Thank you.  (Laughter.)

         Q      Thank you, Mr. Premier.  As a matter of fact,
before your visit to the United States, and also since you set your
foot on the American soil, many of our leaders have such a question
-- that is, given such difficulties that the China-U.S. relations
encountered, why did you still decide to visit the United States as
scheduled?  What are your real thoughts?  And how do you think
China-U.S. relations should develop at the turn
of the century?

         PREMIER ZHU:  Are you asking me to tell you the truth? 
To tell you the truth, I was really reluctant to come.  (Laughter.) 
Two days before my departure from China to the United States, I
received two congressional delegations from the United States, one
headed by Mr. Thomas, the other by Mr. Roth.  All together, more than
20 senators and congressmen were at the meetings.  I said to them, as
the current political atmosphere in the United States is so
anti-China, I really lack the guts to pay the visit to the United
States at present.  And they told me that you should go; we welcome
you, because we Americans like your new face.

         I said, my old friend, Ambassador Sasser told me he was
going to go back to the United States before me and he was going to
each and every place that I was going to visit to introduce me to the
local people and also to promote my trip.  And he also told me that
he was fully prepared to be even beaten black and blue, and maybe
with a bandage wrapped around his face when he saw me in the United
States.  Then I said, even your Ambassador Sasser, an American, had
such a risk of being beaten black and blue, then what would my fate
be as a Chinese?  Will my new face be turned into a bloody face? 
(Laughter.)
        
         The senators and the congressmen didn't give me any
guarantee.  But President Jiang Zemin decided that I should come
according to a schedule, and he is number one in China so I had to
obey him.  Now, I can tell you that I am now in a much better mood
than when I was just about to make the trip, because since I came to
the United States I've seen so many friendly faces and I've been
accorded very warm welcome and reception.

         I believe that through my current visit to the United
States I will be able to contribute some of my part to the continued
growth of the friendly relations and the cooperation between China
and the United States.  And more than that, I will also be able to
get more understanding from the American people and maybe develop
more consensus with the American side on the issues over which we
still argue.

         And we'll also be able to conclude several agreements in
the economic field -- for instance, on SPS.  And, actually, our
negotiations in the field of WTO have been going on for 13 years. 
And on the part of the Chinese side, we have already made a lot of
concessions.  For instance, in the are of TCK wheat, now we have
already agreed to lift the ban on the exports of wheat from seven
American U.S. states to China.  And now we have also decided to lift
the restriction on the export of citrus from four states of the
United States, including California, to China.

         On the question of China's accession into the WTO, in my
view, the gap between the two sides is really not very significant. 
Maybe Mr. President does not quite agree with me on that; their side
still believes that the gap is significant.  So that's why at present
we are only in a position to sign a joint statement instead of a full
package agreement.

         If you want to hear some honest words, then I should say
that now the problem does not lie with this big difference or big
gap, but lies with the political atmosphere.  But we are very
optimistic about the prospect of the development of friendly
relations and the cooperation between China and the United States. 
        
         As I said this morning, I don't think there's any
problem or question between our two countries that cannot be resolved
satisfactorily through friendly consultations.

         As for some other issues, such as human rights and the
Dalai Lama, President Clinton mentioned all these issues in his
opening remarks.  I think we have enough time to argue over these
questions, so I don't want to dwell on these questions long here.

         Q      Mr. President, I have a three-part question on --
(laughter) --

         THE PRESIDENT:  You learned from her, right?

         Q      -- on Kosovo.  Solana says that there are ongoing
discussions on ground troops.  Has the U.S. position changed? 
Question two:  Has the Cypriot intervention helped to pave the way
for the release of the American servicemen?  And, three:  Is
Milosevic a war criminal by Nuremburg standards?

          THE PRESIDENT:  The answer to the first question is,
no, I believe our present strategy will work if we can keep the
allies with it.  The answer to the second question is, I don't know. 
I hope so.  We would like to see the servicemen released because they
never should have been detained in the first place.  They were in
Macedonia; they had nothing to do with the operations against Serbia. 
And I would be for anything honorable that would secure their
release, obviously.

         The answer to the third question is that that is,
strictly speaking, a legal decision that has to be made, but I
certainly think it should be looked into.

         Q      Why are nine commanders named by the State
Department to be possibly indicted, and you don't mention Milosevic?

         THE PRESIDENT:  The answer to that is, I'm not sure. 
The question I want to emphasize to you is, when you start talking
about indicting people there are laws, there are standards of proof,
there are coverages, there are all those issues.  We have asked that
this be looked at.

         What we do know is this.  Let's look at what we know. 
What we know is that by a deliberate policy he has caused hundreds of
thousands of people to be refugees.  We know that thousands of
innocent people have been killed -- defenseless, completely
defenseless people.  We know that people were herded up and pushed to
the borders and pushed over the borders.  And today you all have
stories saying that the same borders that people were herded up and
pushed over or pushed up next to are now being mined, so if they try
to get across them to save their lives they can be blown up.
        
         We know that he supported, strongly, the Serbian actions
in the Bosnian War, which led to the deaths of over a quarter million
people and over 2.5 million people being made refugees.

         Now, the important thing to me is to stop the killing,
to stop the exodus, to see the refugees return, to see them safe, to
see a political solution that gives them the autonomy that they were
promised, to have an international peacekeeping force that will
prevent this from happening again.

         But I have been very clear, Helen -- I think quite
unambiguous that, on the war crimes issue, that is something -- we
have a tribunal set up for that.  We have people whose job it is is
to make that determination.  They should examine it and make that
determination.

         And I think that's all that is appropriate for me to
say, because it's not my job and I'm not a legal expert on that
question.  But I do think that the facts are clear.  The humanitarian
suffering and loss here is staggering, and it is a repeat of what we
saw in Bosnia.  And it is his direct political strategy for first
getting, and then maintaining, power.  And the human loss has been
breathtaking.

         Q      Seven hours before you landed in Andrews Air Force
Base yesterday, President Clinton made a foreign policy speech in
which he mentioned the sending of carriers to the waters in the
Taiwan Straits in March 1996.  And he said that that move had helped
maintain the security in the Taiwan Straits.  So, in your view, how
do you see the effect of the military capabilities of the United
States on the situation across the Taiwan Straits?  And do you think
there should be a timetable for the reunification of the mainland and
Taiwan of China?  And do you wish to pay a visit to Taiwan?

         PREMIER ZHU:  The policy of China and the reunification
of the mainland and Taiwan of China is a very clear-cut one and the
President Jiang Zemin has already expounded on China's policy in this
regard.  So I don't see the need for me to reiterate here. 
        
         Since the return of Hong Kong to the motherland, the
policy of one country, two systems, Hong Kong people administering
Hong Kong, Hong Kong enduring a high degree of autonomy, have been
fully implemented, which is a fact there for the people in the entire
world to see.  And our policy for the reunification of China with
Taiwan is more generous than our policy towards Hong Kong.  That is
to say, Taiwan will be allowed to maintain its army, and we're also
prepared to let the head of Taiwan come to the central government to
serve as the deputy head.

         But as for whether he or she is able to be the head,
then I'm not sure.  But I'm afraid it would not get enough votes. 
Nobody would vote for him.

         On the question of the reunification, the Chinese
government has repeatedly stated that we strive for a peaceful
reunification of the motherland, but we have never undertaken to
renounce the use of force in this regard.  Because if we were to make
such a pledge, make such an undertaking, then I'm afraid that Taiwan
would be in the perpetual state of separation from the motherland.

         Just now, in the Oval Office of President Clinton, I saw
the portrait of President Abraham Lincoln.  Abraham Lincoln, in order
to maintain the unity of the United States and oppose independence of
the southern part, he had resorted to the use of force and fought a
war for that, for maintaining the unity of the United States.  So I
think Abraham Lincoln, President, is a model, is an example.

         As for whether I'm going to visit Taiwan, since none of
them have issued an invitation to me, so how can I go there and in
what capacity should I go there?  I hope you will also help me to
think of this.  (Laughter.)  Thank you.

         THE PRESIDENT:  I think I have to say just one thing, if
I might -- since I got zapped by Abraham Lincoln.  (Laughter.)
First of all, the United States has a one-China policy and I have
reaffirmed that at every opportunity.  I do so again today.

        
         Secondly, we believe that this matter should be resolved
peacefully.  The facts of the relationship between Taiwan and China
over the last 50 years are somewhat different than the facts leading
up to the American Civil War, as I'm sure that you would all agree.

         It does seem to me that China and Taiwan, apart from the
blood ties of being Chinese -- even the native Taiwanese -- that you
have a lot to offer each other, including economic power, but beyond
that as well. 
        
         And so I hope that we will see a resolution of this. 
And I think if the Premier is as humorous and clever in Taiwan as he
is here, I think it would be a good thing for him to go.  (Laughter.)

         PREMIER ZHU:  President Clinton's black and blue. 
(Laughter.)

         Q      A question to the Premier.  Sir, how do you respond
to charges that China stole nuclear warhead designs and perhaps
neutron bomb technology from the United States, and also funneled
hundreds of thousands of dollars to President Clinton's reelection
campaign?  (Laughter.)

         And, Mr. Clinton, do you find any of these charges
credible?  And what do you say to criticism that your policy of
engaging China has benefited China, and not penalized them at all for
human rights abuses, trade problems, and espionage?

         PREMIER ZHU:  In the capacity of the Premier of the
State Council of the People's Republic of China, I'd like to make a
very solemn statement here that I have no knowledge whatsoever of any
allegation of espionage or the theft of nuclear technology.  And I
don't believe such a story.

         I've also asked President Jiang, and he does not have
any knowledge of that at all.  It is not the policy of China to steal
so-called "military secrets" from the United States.  And I don't
think there can be such a problem, given the tight security measures
in the United States and advanced technology.  Although, it seems
that to the technology, with regard to this microphone, is not that
advanced.  (Laughter.)

         I think it's entirely impossible for China to have any
effective -- or to steal any nuclear technology or military secrets
from the United States effectively under such conditions, such tight
security measures.

         In the scientific exchanges between scholars of our two
countries, they may have some exchanges concerning defense
technologies.  But I don't believe that such exchanges will involve
any substantive or key technologies. 

         As a senior engineer, I've been in charge of the
industry in China for more than 40 years, and I have never known any
of our most advanced technology came from the United States.  But the
technology development, or technologies, are the common heritage or
common property of mankind.  And in scientific inventions, actually,
all roads lead to Rome.  And in terms of the missile and the nuclear
technologies, indeed, we have learned that from foreign countries.

         While in the area of missile technology, the pioneer in
China is Mr. Tienjasen (phonetic), who returned from the United
States.  And in terms of the nuclear technology the pioneer in China
is Chenseng Chung (phonetic), who returned from the lab of Madam
Curie of France.  But I can assure you that when they returned back,
they didn't bring back even a piece of paper; they just brought back
with them their brains. 

         That's why I said at the press conference last March
that I hope you don't underestimate your own ability, your own
security ability, or your own ability to keep secrets, and don't
underestimate the capability of the Chinese people to develop their
own technology.

         At a luncheon hosted by the mayor of Los Angeles, the
wife of the mayor asked me, how are you going to celebrate the 50th
anniversary of the founding of the People's Republic?  I told her
that we planned to hold a very grand military review and also the
latest weaponry will be on display.  And I also told her that all the
weaponry are developed by China itself, not stolen from the United
States.  The wife of the mayor gave me advice, and she said, maybe
you should put a sign on the weaponry, the missiles, that say, "Made
in China, not from the United States."  I appreciated her sense of
humor very much, and I said, that's a good idea.  (Laughter.)

         Mr. Clinton stated in the speech that the United States
has more than 6,000 nuclear missiles, while China only has less than
two dozen.  I think he knows better than I do.  I, to tell you the
truth, don't know the exact number of missiles that we have. 
(Laughter.)  Although I do not know the exact number of our missiles,
I agree with you in your conclusion -- that is, we have a very small
number of missiles, and you have a very large number.  So China does
not constitute a threat whatsoever to the United States.

         On the allegation of political contributions or campaign
financing, I can also state in a very responsible manner here that
neither I, nor President Jiang Zemin, know anything about that.  And
we, too, also once asked the senior military leaders in China, and
they told us they didn't have any knowledge of that. 
        
         I think this shows that some Americans really had
underestimated us.  If the political contribution were to be really
that effective, then now I have $146 billion U.S. of foreign exchange
reserved, so I should have put out at least $10 billion U.S. for that
purpose -- why just $300,000?  That would be too foolish. 
(Laughter.)  I've learned that some people have spent a lot in
lobbying here, but I never believed such rumors.
        
         I think through such mutual discussions and even
debates, we can develop consensus and reach agreement on many issues. 
That will serve the interests of both the Chinese and American
peoples.  And we also trust the American people and we, actually, we
have never and we would not do such kind of thing.

         THE PRESIDENT:  Let me respond to the question you asked
me.  First of all, with regard to the two issues, the campaign
finance issue and the espionage allegations, I raised both these
issues with Premier Zhu last night.  He gave me the same answer he
just gave you today.  And my response was that I hope that he and his
government would cooperate with these two investigations.
         You know, China is a big country with a big government. 
And I can only say that America is a big country with a big
government, and occasionally, things happen in this government that I
don't know about.  And so I think it's important that we continue the
investigation and do our best to find out what happened, and I asked
for his cooperation.

         Now, as to the second part of your question, which is,
what do we get out of this -- the sort of anti-China crowd in America
says.  First of all, the implication is that if someone wants to have
a relationship with us, they should agree with us about everything --
that's just not going to happen. 
        
         But I would like to point out the following things.
Because of our cooperation with China, we have lessened the tensions
on the Korean Peninsula for several years, China has participated
with us in any number of arms control
initiatives,       including an agreement to restrain its transfers of
dangerous weapons and technology to other countries.  China is a
signatory to the Comprehensive Test Ban Treaty, and China has worked
very hard, as I already said, to stabilize the Asian economy at a
time when it was not only hurting people in Asia, but it was
beginning to affect the American economy.  So we get quite a lot out
of our cooperation with China.

         Last point.  When you say, what do we get out of it?  He
could have people asking him that in China.  They could say, it is
the United States, not the European Union, that sponsors the human
rights resolution.  The United States has stricter controls on
technology transfer to China than any other country with which it
deals -- both of which are true.

         But let me just give you one final example -- take the
WTO.  How could it possibly serve America's interests not to open
more Chinese markets to America's workers and businesses and farmers? 
They have a much bigger share of our market, in terms of exports,
than we have of theirs.  How could it possibly be against our
interest to bring more Chinese into contact with more Americans, and
to give more opportunities for America to honestly compete in the
Chinese market?

         I think it is clear that the more we work together and
talk together, and the more China is involved with the rest of the
world, the more likely we are to reach positive outcomes.  That is
the logic of the policy, and the logic of what we are doing in
particular on WTO.

         PREMIER ZHU:  I agree to cooperate with your side in
investigation, so long as you can provide some clues.  And no matter
who it may involve, we will investigate it. 

         I'd like here to respond to what President Clinton said
on WTO.  He said that to allow China in the WTO will be in the best
interest of the American people.  And I want to say that although
China has made the biggest concessions, that will also be in the
interest of the Chinese people.   Many Hong Kong newspapers say that
I've come to the United States to present a very big gift.  I don't
think such a suggestion is right.  I'm sorry, I'm afraid I've
offended the press.  (Laughter.) 

         Because if China wants to join the WTO, wants to be
integrated in the international community, then China must play by
the rules of the game.  China cannot do that without making
concessions.  Of course, such concessions might bring about a very
huge impact on China's national impact on some state-owned
enterprises, and also on China's market. 
        
         But I have every assurance to say here, thanks to the
achievements made in our reform and opening up process, we will be
able to stand such impact.  And the competition arising from such
impact will also promote a more rapid and more healthy development of
China's national economy.

         Here I'd like to call the attention of the Hong Kong
press people.  In your future reports, don't ever write things like
"present a big gift," because that would be interpreted -- equivalent
to a political contribution or campaign financing.  That would be
very much detrimental to President Clinton.  (Laughter.)

         Q      I'm a correspondent with CCTV China.  Recently,
there has been much talk within and out of China about China's
economic development, reform and opening up policy.  So, Mr. Premier,
would you please make some observations on the current state of
China's economy and the prospect of economic development in China. 
And what impact do you think China's economic development will have
on the stability and the development of the economy in Asia and the
world at large?

         PREMIER ZHU:  Last year, China's economy experienced
extreme difficulties due to the Asian financial crisis and the
devastating floods hitting some areas in China.  But we have tided
over these difficulties and managed to achieve a 7.8 percent growth
of our GDP.  And we have maintained a policy of not to devaluate the
R&B currency.  And the prices in China have been maintained basically
stable and some have somewhat declined or have dropped.

         As for the economic development in China this year, many
foreigners are predicting that China will be the next to be hit by an
economic crisis.  But I don't think that will be the case.  This year
the projected GDP growth is 7 percent; but in the first quarter of
the year the growth rate was 8.3 percent.  So I expect China's
economic development this year to be better than that of last year --
not in terms of the speed, simply in terms of speed, but in terms of
the economic efficiency, economic results.

         Secondly, some foreigners are saying that China's
economic reform has come to a stop.  I wish to state here in very
explicit terms that last year, instead of coming to a standstill,
China's reforms made greater progress than originally planned.

         Firstly, in terms of the reform of the government
institutions, last year we set the objective of cutting the size of
the central government by half in three years time -- that is, from
33,000 people to 16,000 people.  And this objective had been realized
last year, just in one year.  Apart from 4,000 government
functionaries who have now gone to universities or colleges for
further study, all the rest have been re-employed by other sectors,
by enterprises.  And so I think that represents a very major
achievement.

         And this year, we plan to press forward the reform of
the local governments.  We also plan to cut the size of the local
governments by half in three years time -- that is, to cut from 5
million people to 2.5.

         Certainly, some foreigners are saying that there is a
very serious problem of unemployment in China, a lot of people have
been laid off  from state-owned enterprises and this has caused a
social instability in China.  I think anybody who has been to China
will know that this is not true.

         In the beginning of last year, indeed, there were 10
million laid-off workers or unemployed workers.  Thanks to our
efforts over the past year we have put in place a social security
system.  Now all those laid-off workers or unemployed workers can get
basic living allowances.  And many of them have been re-employed. 
Now there are 6 million unemployed or laid-off workers who are in
those re-employment service centers waiting for being re-employed.

         While the establishment of such a social security system
is very helpful to our efforts to revitalize, rejuvenate the
state-owned enterprises by introducing shareholding system into the
large state-owned enterprises, and also to reform the small and the
medium-sized enterprises in various ways, including to privatize some
of the small ones.

         Lastly, China now is introducing an unprecedented reform
in its banking system.  We are drawing on the experience of the RTC
in the United States to form the Assets Management Companies in China
to handle the non-performing loans of the state-owned banks.  I
believe that such reform is conducive to turning the state-owned
commercial banks into genuine commercial banks, and is also conducive
to helping enhance the ability of the central bank to supervise and
to regulate according to international practice.

         So here, I'd like to say that China's RMB will not be
depreciated and it will remain stable.  So here, I'd like to call on
the American business people to go to China for investment.  You will
not face the risk of devaluation of RMB.  If you don't believe me,
then I would take the advice from Professor Milton Miller of Chicago
University.  He advised me to offer a put option to those who don't
believe me.

         Thank you very much.

         THE PRESIDENT:  Larry?

         Q      That was tough.

         THE PRESIDENT:  That was real statesmanship. 
(Laughter.)

         Q      I think it was more of a ham, but -- I have
questions for both you gentlemen.  Mr. Premier, as you know the U.S.
State Department issued a rather scathing report on human rights
abuses in your country, and the United States is in the process of
sponsoring a resolution before a U.N. group to criticize human rights
in your country.  Do you consider these assessments totally unfair,
or do you think it's possible that there are problems within your
country that need to be corrected?

         And, President Clinton, at your last formal news
conference, you spoke about the problems, or at least allegations, of
Chinese spying, and you said that it mainly dealt in the 1980s, that
there were no indications that it involved your presidency.  In the
wake of today's New York Times report, can you still make that
statement?  Or are you concerned that perhaps you were misled, or had
information withheld from you about the extent of the allegations?

         PREMIER ZHU:  Me first?  (Laughter.)

         THE PRESIDENT:  You're the guest.  (Laughter.)
         PREMIER ZHU:  Thank you.  Firstly, I wish to say I'm
firmly opposed to the U.S. tabling of a draft resolution directed at
China at the Human Rights Commission session.  I not only regard that
as unfair, but also take it as an interference in China's internal
affairs. 
        
         I wish to make three points here.  Firstly, China has
made very big progress in the human rights area over the past several
decades since the founding of new China.  And the Chinese people
today enjoy unprecedented extensive democratic and political rights.

         Through certain legal procedures, through certain
procedures, the Chinese people can voice their criticisms of the
government and they can also exercise supervision over the
government.  And they can express fully their opinions.  And in my
view, in terms of the freedom of speech and freedom of press, China
indeed has made very great progress.

         Secondly, I also think that we should put the question
of human rights in a historical perspective.  And I think different
countries may have a different understanding of this question.  In
terms of the human rights concept, Mencius, who lived in a period
more than 2,000 years ago in China, he stated that people are the
most important and the most precious, while the state is next to
that, and the emperor or the kings are the least important.  So that
kind of thought was much earlier than Rousseau of France, and then
the Human Rights Declaration of France.

         And also, different countries have different conditions,
and human rights, actually, is also a concept that has evolved in
history.  In terms of per capita income, the per capita income of the
United States is 20 times that of China.  And also, in terms of
education, the ratio of university graduates in the United States, in
its total population, is higher than the ratio of the illiterate
people, plus the primary school graduates to the total population in
China.  So given such different levels of education and also income,
it's natural that people may have different concepts of human rights.

         For instance, if you want to talk about human rights to
a very poor person, maybe what he is more interested in is -- if you
want to just talk to him about direct election.  But maybe that's not
what he is most interested in.  What he is interested in most is the
other aspects of human rights, such as the right to education, the
right to subsistence, the right to development, the right to a
cultural life, and the right to medical care, health care.  So I
think human rights actually include so many aspects.

         So I think every country has its own approach in
improving its human rights.  One should not be too impatient, but to
tell the truth, I'm more impatient than you are in how to further,
constantly improve the human rights in China.

         Thirdly, I concede that there is room for improvement in
human rights conditions in China.  As you may know, China has a
history of several thousands years of a feudal system, feudal society
-- so people have very deep-rooted concepts influenced by this
historical background.  It's quite difficult to change such mentality
or concept overnight. 

         And also in China, the legal workers, the people working
in the legal and the judicial field, some of them are not that
qualified, are not that competent -- so sometimes in dealing with
certain cases they need to improve their work.  So under such
conditions it's really not realistic to demand a very perfect
practice in the human rights field.

         So we are willing to listen to you and we are willing to
have channels of dialogue on human rights question.  We don't want to
stage a confrontation in this regard. 

         Actually, in China, when I received some foreign
visitors, they tend to put forward a list of so-called dissidents and
ask me to release these people.  Well, actually, we took this matter
very seriously and we have looked into all these cases, and if we
found that the person on the list has not committed any criminal
offenses, then we will just release him. 

         Well, before I came to the United States, many of my
friends mailed me a lot of materials in which they contained a lot of
information about the problems of human rights in the United States. 
And they urged me to bring such materials to President Clinton, but I
haven't brought them with me.  I don't want to hand that over to
President Clinton because I trust you are able to resolve your own
problems. 

         THE PRESIDENT:  Actually, sometimes we could use a
little outside help, too.  (Laughter.) 
        
         Let me say, first of all, in response to the question
you raise, I read The New York Times article today, and while I can't
comment on specific intelligence reports as a matter of policy, I
noted that even the article acknowledged that the alleged espionage
might not have been connected to the national labs, which is the
question I was asked in the press conference.

         But let me say, I've looked into it and we're doing our
best to resolve all outstanding questions.  And I've asked the law
enforcement agencies to try to accelerate their inquiries insofar as
they can. 

         The real issue is, and one that we made perfectly clear
last week, is that for quite a long while, from the '80s coming right
up through the time I became President, the security at the labs was
inadequate.  And I think it grew out of, partly, the kind of dual
culture of the labs -- part of their great centers of science and
learning, and they've done a lot of path-breaking work in energy, and
alternative sources of energy, and computer processing, and the use
of software for all kinds of very important non-defense matters --
while maintaining their responsibilities in the nuclear area.

         And to me, the most important thing of all now --
besides finishing the investigations in an appropriate way -- is
making sure we get the security right.  You know that I signed that
executive order in early 1998.  You know what Secretary Richardson
has done recently.  And I have also asked the President's Foreign
Intelligence Advisory Board Chairman, Senator Rudman, to head a
bipartisan panel to look into what we have done, and to tell us if we
haven't done enough and what else we ought to do.

         So I think the most important thing now is to recognize
that for quite a long while, the security at the labs was not
adequate, that we have been moving to do a lot of things in the last
year-plus, that we have much more to do -- perhaps -- and we asked
somebody to look into it, and then to do these investigations and do
them right, and do them as quickly as possible.

         THE PRESS:  Thank you.

END                      5:21 P.M. EDT