HANDS ACROSS THE PACIFIC

Forum: Tough Times Ahead: Three experts assess China's prospects

AMERICAN SECRETARY OF STATE Madeleine Albright went to Beijing determined to accentuate the positive. True, she had earlier denounced China's record on human rights while in Japan: "Some dissidents have been released," she said, "but the Chinese government's repression of dissent and religious freedom has not ceased." She also presented the government with a list of some 2,000 political prisoners and asked for details of their status. Beijing was also irritated that her entourage included Greg Craig, Washington's new special envoy on Tibetan affairs.

But the Americans took pains to stress that diplomat Craig was there in another capacity. And the secretary of state emphasized the U.S. is seeking a much wider, "full-service relationship" going beyond human-rights issues, beyond even constructive engagement. "We are, in fact, beginning a process between two great powers," she told a meeting of American businessmen, which involves "getting the views of the Chinese leadership on events not only in their own country but in the region and globally."

Her itinerary during two days in the Chinese capital was carefully planned to allow her to highlight areas where the authorities have loosened up in recent years. She visited the Beijing Film Studios and was photographed with one of China's world-class directors, Chen Kaige, of Farewell My Concubine fame. She also visited the National Judges College and spoke to a number of the judges-in-training at a roundtable discussion. That allowed her to make several references to the growth of the rule of law.

When she met Chinese President Jiang Zemin, Albright handed over a large manila envelope containing a letter from President Bill Clinton. Jiang laughed and handed her a large white envelope in return. Albright joked that this was the best way to do mail between leaders.

Clinton is due to start his landmark visit to China in late June, and already he has made two big concessions that please Beijing enormously. (In return, he gets to make a televised speech to the Chinese people, apparently uncensored.) Clinton has agreed to an official welcome in Tiananmen Square, traditional greeting place for important foreign dignitaries but, of course, heavily symbolic of the bloody crackdown on the anti-corruption and democracy movement nine years ago. And he has agreed to go only to China during this trip to Asia, not even making a courtesy stop in Japan.

The latter move has annoyed Tokyo, which is closely watching the warming Sino-American relationship, and frets that China may someday displace Japan as America's main strategic partner in Asia. Albright did include Japan in her trip, and while there repeatedly referred to the "unique and lasting partnership" between Washington and Tokyo. She also participated in the signing of an agreement for reciprocal services and back-up between the Japanese and American armed forces - a pact that raises suspicions in Beijing.

As for the main issues during Clinton's visit, Albright dropped a hint it might include a new communiqué on Taiwan. Some observers had their doubts. "If the U.S. drafted something new that is absolutely clear on the issue," reckons academic Yang Dazhou, "they would be accused of abandoning Taiwan." Indeed, America's formal position has not changed since president Richard Nixon visited Beijing in 1972. Still, Albright declined to predict what final form the document would take, which seems to suggest there will be one.

Scenes like this and worse have erupted in many Chinese cities since the State Council banned all forms of direct marketing last month. The worst unrest occurred in Hunan province, where 10 people died and more than 100 others were injured after direct marketers went on a rampage.

The irony is that the ban reflects official concern that pyramid schemes and other scams, not to mention the disquieting fervor of direct-sales marketers, could destabilize society and possibly even undermine the Communist Party. The official press dutifully played down the unrest while enumerating the evils of direct-sales scams - the potential for corruption and fraud - and linked them to superstition, cults and hooligans.

The American direct-sales marketers who have entered China in a big way in recent years have decided cooperation is the best tactic, at least for now. Amway, the giant distributor of soap and detergent, accepted a government proposal to turn its distribution centers into retail stores. Avon and Mary Kay, also with large investments in China to protect, have not yet decided whether to follow Amway's lead.

U.S. Trade Representative Charlene Barshefsky complained the ban failed to distinguish between legitimate businesses and con men. But Secretary of State Madeleine Albright apparently did not raise the issue during her trip, and it seems unlikely that President Bill Clinton will put the Avon Lady on the agenda during next month's summit.

- By Todd Crowell