In an eight-day span in June, lobbyists from Akin Gump Strauss Hauer & Feld contacted federal and state officials nearly 250 times in an unsuccessful effort to build support for an $18.5 billion bid for Unocal by China National Offshore Oil Co. And Akin Gump was just one of six top-flight lobbying firms hired by CNOOC to push its bid.
At Akin Gump, a strike team made up of more than a dozen of the firm’s most influential lobbyists descended on Capitol Hill with newspaper excerpts, Wall Street Journal editorials and talking points that highlighted the Western qualities of CNOOC, 70 percent of which is owned by the Chinese government. The team drafted “Dear Colleague” letters for members of Congress to pass on to their fellow legislators. Rep. James Moran, a Virginia Democrat, even stopped by Akin Gump’s swanky offices for a personal briefing on CNOOC’s bid.
“The lobbying on CNOOC was particularly intense on both sides,” said Rep. Rick Larsen, D-Wash., one of the founders of the U.S.-China Working Group, a new congressional panel that focuses on trade and diplomacy issues. “It was really symbolic of the problems that we are having defining what our relationship with China will be in the future.”
While CNOOC’s lobbying onslaught might seem an unusual strategy to be used by a state-owned company from the world’s largest communist country, it is really just the latest and most visible example of China’s long-running and rapidly escalating efforts to influence U.S. policy and public opinion.
“Direct, indirect and covert”
Since July 1997, the Chinese and Hong Kong governments and government-controlled companies and organizations have spent at least a combined $19 million lobbying the U.S. government, according to a Center for Public Integrity analysis of foreign agent lobbying disclosure records filed with the U.S. Department of Justice. A small amount of that total accounts for lobbying efforts by private companies in mainland China and Hong Kong, such as the conglomerate Hutchison Whampoa.
The Center study focused on lobbying disclosure forms filed with the Justice Department’s Foreign Agent Registration Act public records office. U.S. organizations working for foreign governments or foreign government-controlled enterprises are required to file detailed reports on their activities with the FARA office. Foreign companies that are not government-controlled can either file disclosure forms with FARA or Congress, or they can file with both. Disclosure forms filed with Congress, however, are much less detailed than FARA filings. (See methodology)
To take their message to Capitol Hill, state capitals, the media and the U.S. public, Chinese clients have hired some of the most prominent and well-connected lobbying shops, public relations specialists and law firms in Washington, including Patton Boggs, Hogan & Hartson, and Wexler and Walker Public Policy Associates. The contracts cover services that range in scope from a one-shot effort at arranging a meeting between China’s U.S. ambassador and a senator to discuss a Taiwan-related security bill to decades-long assignments to persuade legislators on trade, tariffs and human rights issues affecting China.
“China is expanding its influence and network on a daily basis,” said Michael R. Wessel, a member of the U.S.-China Economic and Security Review Commission, a bipartisan body appointed by Congress to investigate and monitor the national security implications of the countries’ relationship. “Their attempt to influence Congress is direct, indirect and covert.”
Lobbying records show that lobbyists and PR specialists gave tours to congressional staffers in Hong Kong. They wined and dined U.S. representatives to push for permanent Normal Trade Relations status for China. And they reached out to reporters from newspapers across the ideological spectrum, from The Washington Times to The New York Times.
Among other findings:
- The Government of the Hong Kong Special Administrative Region has been significantly more aggressive than the People’s Republic of China government in its attempt to influence the U.S. government and seek favor with the American public. This is especially true on trade matters. Since July 1997, the government-backed Hong Kong Trade Development Council spent $7.2 million, more than any other Chinese client, to lobby on issues affecting Hong Kong, including China’s entry into the World Trade Organization and the 2003 SARS epidemic. To get the work done, it hired seven lobby shops.
- Reacting to growing criticism of China in Congress, over the past two years the nation’s government has retained additional top lobby and law firms to improve its connections with official Washington and to secure strategic advice on trade matters. In contrast to new hires Patton Boggs and Hogan & Hartson, the firm of Jones Day has represented the Chinese government since 1986, lobbying the White House, federal agencies and Congress on issues ranging from religious freedom to the 2008 Olympic Games in Beijing.
- British-owned WPP, in its own words “one of the world’s largest communications services groups” with offices in 103 countries, tops the earnings list among firms that lobbied and did public relations on behalf of mainland China and Hong Kong since July 1997. So far, WPP has received $5 million. Its affiliated firms Wexler & Walker Public Policy Associates, Hill & Knowlton, Inc. and Burson-Marsteller have extensively represented the interests of the Hong Kong government in the United States. Another WPP firm, BKSH & Associates, was part of CNOOC’s lobbying offensive.
- Second behind WPP on the top 10 earnings list is Garvey Schubert Barer, a law firm with offices in Washington, D.C., and Beijing. Since 1985, the firm has counseled the government-owned China Ocean Shipping Co., whose cargo vessel Liu Lin Hai in 1979 became the first to call at a U.S. port in 30 years.
- Hong Kong-based Hutchison Whampoa Ltd., a Fortune Global 500 company with holdings that include communications, ports and energy, is seeking to boost its image on Capitol Hill. It recently hired the public relations firm Public Policy Impact Strategies to arrange “courtesy visits” with members of Congress. In recent years, the conglomerate raised concerns among Washington officials over its alleged connections with the Chinese government.
Meanwhile, on the Hill …
The lobbying offensive comes at a time when more than two dozen bills touching on different aspects of the U.S.-China relations—including Taiwan-related defense issues, intellectual property rights and World Trade Organization compliance—are pending in Congress.
Two groups on the Hill formed to monitor China-related issues have popped up in recent months: the Congressional China Caucus, led by Rep. J. Randy Forbes, R-Va., and the U.S.-China Working Group, launched by Larsen and Rep. Mark Kirk, R-Ill.. The difference in the groups’ stances seems to reflect a deep division in attitudes toward the Asian nation: some look at China and see a threat to the United States, but others see a potential partner. While the Congressional China Caucus says it will “investigate China’s global reach and the consequences of its growing international, economic, and political influence on U.S. interests,” the U.S.-China Working Group says it will focus on finding “new opportunities for a successful and strategic relationship.”
Lobbyists say that their job is to help their Chinese clients be understood by the U.S. government. “China is serious about being a member of the world community, and the world will have to deal with that,” said one Washington lobbyist, speaking on condition of anonymity because he didn’t have clearance from his clients to comment. “Our system requires an active intervention with the government, and that requires lawyers and requires lobbyists.”
One expert on China said that the increased lobbying is part of a natural progression.
“The lobbying seems consistent to me,” said Bates Gill, who holds the Freeman Chair in China Studies at the Center for Strategic and International Studies in Washington, D.C. “In other words, as the U.S.-China relationship has become more complex, it’s normal that our counterparts in China will seek advice. And Americans do the same thing. In Beijing, consulting is a big business.”
Rep. Frank Wolf, R-Va., a member of the Congressional China Caucus, disagrees. On July 12, the congressman sent a strongly worded letter to Akin Gump’s lobbyists questioning their representation of CNOOC. “When I noted that CNOOC was one of your newest clients, I immediately thought, ‘Is there no bright line to separate who the lobbyists in Washington will or will not represent?’” wrote Wolf.
In an interview Wolf said: “The Chinese government is prosecuting Christians. They have Catholic bishops and Protestant pastors in jail. In Tibet, they are prosecuting Muslims and Evangelicals. The Chinese government is spying on the United States. Why would you work for a government that is spying on the United States? Greed is driving them.”
Daniel Spiegel, a partner at Akin Gump, said that the firm’s relationship with the Chinese oil company “has come to an end,” but that Akin Gump feels “perfectly comfortable with our representation of CNOOC. We were not representing a country; we were representing a company.”
All told, lobbyists and experts say that the bulk of the money spent on lobbying on behalf of China actually comes from U.S. corporations that have interests there. Executives from Coca-Cola, Ford Motors, Wal-Mart, Microsoft and other big companies sit on the board of directors of the U.S.-China Business Council, which “works to enhance media and public understanding of complex issues in U.S.-China relations,” according to its Web site.
More lobbying partners
With a busy front on the Hill, in July the Chinese Embassy hired the firm of Patton Boggs for a monthly fee of $22,000. Lobbying records vaguely state that the firm will counsel the embassy on “congressional matters.” The firm has assigned Mark Cowan and Bob Horn, both former officials in the Reagan and George H. W. Bush administrations, and Timothy Chorba, who was U.S. ambassador to Singapore from 1994 to 1997, to that task. Patton Boggs officials declined to comment on the firm’s work for China.
Meanwhile, Cleveland-based Jones Day, the second-largest U.S. law firm, has maintained a long relationship with the Chinese Embassy. Jones Day has been paid $1 million to carry the embassy’s water in official Washington since 1997, according to its disclosure forms.
Jones Day has a substantial presence in China, maintaining offices in Beijing, Hong Kong and Shanghai.
Unlike many FARA filings, Jones Day’s records contain few details on its specific lobbying activities on behalf of the embassy. The filings show that the firm has lobbied Congress, the White House and various federal agencies on trade and tariff issues, Radio Free Asia, human rights, U.S. sanctions, Taiwan, Tibet, Hong Kong, proliferation issues, religious freedom, the World Trade Organization, the 2008 Olympics, foreign exchange rates and maritime law.
China’s recently appointed ambassador to the United States, Zhou Wenzhong, seems determined to build solid relationships on Capitol Hill. In less than a month this summer, the ambassador met with congressmen twice.
He spoke on June 30 at the launch of the U.S.-China Working Group. On July 20, the Chinese ambassador engaged in what a congressional aide described as “a small, casual” meeting with members of Congress to discuss currency and national defense issues, including a statement by a Chinese general that China will respond with nuclear weapons if the United States intervened in a conflict over Taiwan.
“I hadn’t seen a Chinese ambassador on the Hill before,” said Larsen. “In the past four months, the Chinese embassy has been more aggressive in trying to contact members of Congress.”
Another outfit working for the government of the People’s Republic of China is Hogan & Hartson LLP, a Washington, D.C., law firm with offices in Hong Kong and Beijing. China hired the firm in October 2003 to get advice on WTO negotiations. Its disclosure forms say that Hogan & Hartson “also may render advice” to the Chinese central government “on U.S. laws, regulations, policies and [government] actions.” Handling the work is Jeanne Archibald, the firm’s director of international trade; in the early 1990s, she was general counsel at the Treasury Department. So far, the firm has received slightly more than a half-million dollars from the Chinese government.
Hogan & Hartson is also representing the Liaoning Province of northeast China in a lawsuit brought by Yang Rong, a former chief executive officer of the country’s largest maker of vans. Yang fled to the United States in 2002 after the provincial government accused him of financial mismanagement. He sued the Liaoning Province in the United States, but a federal court in the District of Columbia ruled in March that it had no jurisdiction in the case. Yang has appealed.
The blitz up close
As part of the CNOOC lobbying blitz, Akin Gump put 13 of its best-connected lobbyists on the job to try to win over legislators and White House officials, disclosure records show.
Led by Daniel Spiegel, former U.S. permanent representative to the United Nations under President Bill Clinton, the team included Bill Paxon, a former Republican congressman and key adviser to George W. Bush’s 2004 presidential campaign; Victor Fazio, a former Democratic congressman from California; and Toby Gati, a former White House and State Department official in the Clinton administration.
In just eight days at the end of June, the lobbyists reported about 250 contacts with the Office of the President, the Office of the Vice President, the Department of Energy, the Department of Commerce, and a long list of congressmen and senators and their staffs. Records show that while some lobbyists knocked on the doors of legislators, others worked the phones, sent out dozens of e-mail messages with information about CNOOC and distributed favorable newspaper articles about the Chinese company.
Lobbyists also called and sent e-mail to officials at the Treasury Department, which houses the Committee on Foreign Investments in the United States—or CFIUS—a panel that reviews corporate mergers on national security grounds.
At the same time, many of the same public officials also were being lobbied by Chevron Corp., the California-based oil company that merged with Unocal after CNOOC withdrew its bid in July. “Our lobby was very intense because of the opposition [to CNOOC in Congress],” said Akin Gump partner Spiegel.
Lobbying records show that the ambassador called Rep. James Moran, D-Va., the week before the congressman voted against resolutions that condemned the CNOOC bid on June 30. Spiegel denied calling Moran and said that the filing with the Department of Justice, which says that the ambassador called James Moran on June 23 and carries Spiegel’s signature, contained a “mistake.”
“I just got the weeks mixed up,” said Spiegel. Moran also denied the contact. As of Sept. 6, Akin Gump had not filed an amendment with the Department of Justice correcting what Spiegel said was an error.
Moran said that he did meet with Spiegel on July 8, when he was driving his car in Dupont Circle and decided to stop by Akin Gump’s offices. There, Moran received a 30-minute personal briefing on CNOOC’s potential purchase of Unocal.
“I happened to be in Dupont Circle already, so it was easier for me to stop by their office. Security is difficult these days in the Hill,” said Moran.
“We briefed him on the transaction, and we asked him what he thought was likely to happen at the Senate,” Spiegel said.
Moran said there was no lobbying because the meeting occurred after he already had made up his mind and voted on legislation involving the CNOOC case. He said he didn’t send out a “Dear Colleague” letter written for him by Akin Gump lobbyists. The letter condemned an amendment that banned Treasury from using funds to recommend approval of the merger between Unocal and CNOOC.
On July 25, Akin Gump’s PAC contributed $1,000 to Moran’s congressional campaign, but he said that is not out of the ordinary. “I normally get $1,000 from Akin Gump,” Moran said. He added, “The firm is not a significant giver” to his campaign.
Three other congressmen whose votes favored CNOOC received contributions from Akin Gump at about the same time: Mark Steven Kirk, R-Ill., Paul Ryan, R-Wisc., and Tom Davis R-Va.
Moran added: “I represent thousands of lobbyists in my district [in the Virginia suburbs of Washington] so I am not going to say anything negative about them. But I read that Chevron spent millions of dollars lobbying on this issue and, thus, saved themselves a lot of money in the purchase of the company.”
He said he wishes that there had been less lobbying on the CNOOC issue.
“Probably Chevron taught the Chinese a lesson,” said Moran. “And they will feel that they need to be more involved in the future.”
Hong Kong plugs in
The biggest player by far with ties to the Chinese government, the Hong Kong Trade Development Council, says that it doesn’t work for the central government in Beijing at all.
Great Britain returned Hong Kong to China in 1997, but only under the condition that it could maintain its free market economy and some other democratic institutions. Hong Kong’s relationship with the mainland has remained a hotly debated topic ever since, commonly portrayed as “one country, two systems.”
When it comes to trade and commerce, however, the interests of Hong Kong and Beijing are commonly aligned, with Hong Kong in recent years seeking to become the trade and financial gateway to the fast-growing mainland. For example, HKTDC underwrote a major lobbying effort to convince the U.S. government to grant permanent Normal Trade Relations to China in 2000. More recently, it has sponsored a Washington lobbying offensive on textile trade with China.
HKTDC does not have a Washington office, but it maintains bureaus in New York, Chicago, Los Angeles and Miami. Its U.S. lobbying activities are coordinated through the Hong Kong Economic and Trade Office in Washington, an arm of the Hong Kong government.
According to lobbying disclosure records, the firms contracted by HKTDC were expected to “identify key lobbying targets in the U.S. Congress and Administration who may have a bearing on legislation or policies affecting the trade interests of Hong Kong.”
“We did lobby for [Normal Trade Relations] status for China, but purely as it related to Hong Kong,” said Daniel McAtee, senior information officer at the Hong Kong Economic and Trade Office in Washington. “We are always keen to highlight the distinction.”
Since the turnover of Hong Kong to China in 1997, HKTDC has spent $7.2 million to maintain an expensive stable of thoroughbred lobbying firms to roam the halls of official Washington on its behalf.
Among them:
- Wexler & Walker Public Policy Associates. ($3,043,145) This top-tier lobbying firm is headed by former U.S. Rep. Robert Walker and Ann Wexler, a top official in the Carter Administration who has since gone on to become one of the city’s leading lobbyists. The firm has had dozens of meetings and meals with congressional members and staff, including Reps. Michael Castle,R-Del., and John Shadegg, R-Ariz., to push Hong Kong issues such as textiles, China’s permanent NTR status, and technology transfers. The firm has also had meetings with administration and agency officials, including Bob Cassidy, who was chief U.S. negotiator on WTO accession for China. Records also show that Walker arranged receptions for HKTDC.
- Loeffler Tuggey Pauerstein Rosenthal, LLP. ($1,634,462.69) This government affairs shop is headed by former U.S. Rep. Tom Loeffler, a key fundraiser for and insider in the administrations of President Bush and his father. Lately, the Texas Republican served as South Texas co-chairman for Bush-Cheney ’04, Inc. The firm has lobbied the White House and Congress, including Sen. John Kerry, Sen. Rick Santorum and House Minority Leader Nancy Pelosi’s staff, on trade concerns, the “one country two systems” philosophy and the SARS epidemic, among other issues. The firm did not return phone calls about its work for HKTDC.
- Powell, Goldstein, Frazer & Murphy, LLP. ($976,923.43) This blue chip law firm is based in Atlanta, but maintains a substantial lobbying practice in Washington. The firm lobbied on behalf of HKTDC on international trade matters. In the past, it also represented the commercial office of the U.S. Embassy of China, the state-owned China Textiles Import/Export Corp., and the Hong Kong Economic and Trade Office in Washington. The company says it has not lobbied for HKTDC or any China clients for the past several years.
- Sidley Austin Brown & Wood. ($888,187.95) Chicago-based Sidley Austin is one of the largest law firms in the country and has offices in Hong Kong, Beijing and Shanghai. The firm has 225 attorneys in its Washington office. It has lobbied for HKTDC on textile and apparel trade matters. The firm did not return phone calls about its work for HKTDC.
- Patton Boggs, LLP. ($251,054.14) Patton Boggs is one of the most powerful lobbying firms in Washington. It has lobbied Congress and U.S. Customs officials on behalf of HKTDC on textile matters, for which it collected a quarter-million dollars between July 2001 and June 2002, records show.
A big portion of the efforts to sell Hong Kong in the United States has been in the hands of public relations firms, which have targeted the media.
Burson-Marsteller, one of the world’s largest public relations companies, represents the Hong Kong Economic and Trade Office. It has reported “generating positive [media] stories,” and “responding swiftly to inaccurate or unfavorable coverage,” as well as “recommending and qualifying journalists to visit Hong Kong as part of the sponsored visitor program.”
The firm also arranged a meeting between Gov. Arnold Schwarzenegger and a Hong Kong government official to talk about trade opportunities for California companies, and worked to position Hong Kong “as a strategic partner that the U.S. could engage” in exploring opening up mainland China.
In the past, Burson-Marsteller represented the People’s Republic of China Ministry of Culture and the government-backed Better Hong Kong Foundation.
A Hong Kong press group even spent more than $124,000 to fight a mention in the Department of State Annual Report on Human Rights Practice, lobbying records show.
The Oriental Publishing Group hired Washington-based TKC International in early 1997 to send out a letter to 17 senators and 47 congressmen, including John Ashcroft and John Kerry, in which it protested “a serious error of fact” which characterized one of its newspapers, the Oriental Daily News, “in a negative manner” in the freedom of speech section of the 1996 DOS report. A letter was also sent to Timothy E. Wirth, the State Department’s undersecretary for global affairs.
The DOS report said that the Oriental Daily News, one of the most popular dailies in Hong Kong, had set off “a newspaper price war” when it lowered its retail price “in an attempt to woo readers away from Apple Daily, a tabloid-style daily newspaper that has captured a larger share of the market from other papers.” The report also stated that the price war led to the closure of four newspapers, a weekly periodical and a newspaper supplement.
The Taiwan issue
One of the more unusual FARA filings involving lobbying for the Chinese government was submitted by former U.S. Sen. L. Bennett Johnston, a powerful Louisiana Democrat responsible for most of the energy legislation that moved through Congress in the 1980s and early 1990s.
Johnston said in his filing that he set up a meeting between himself, his “friend” former Chinese Ambassador Jiechi Yang, and Michigan Sen. Carl Levin to state the ambassador’s opposition to a section of the fiscal year 2003 defense authorization bill.
Section 1202 of the bill established “joint operational training for, and exchanges of senior officers between,” the United States and Taiwan armed forces.” The People’s Republic of China has considered Taiwan an illegitimate entity ever since 2 million Nationalists retreated to the island and set up a separate government after the 1949 communist victory in the mainland.
Since then, the United States’ security commitments to Taiwan have often inflamed the Chinese leadership.
According to lobbying records, the Chinese ambassador wanted Congress to get rid of Section 1202, which had been inserted into the bill by House Majority Leader Tom DeLay, who was the House majority whip at the time.
In the filing Johnston said that he received no compensation for arranging the meeting and none was expected. Although passed by the House, the provision was watered down to require only a feasibility study.
Johnston could not be reached for comment, but his son said that the filing was made due to an “overabundance of caution.”
“Dad just made the filing to be absolutely sure that he was in the clear,” said Hunter Johnston, who is a partner with his father in a Washington lobbying firm, Johnston & Associates.
On its Web site, Johnston & Associates says Hunter “has been active throughout Southeast Asia … concentrating his attention and time in China, Indonesia, India, Bangladesh, and Thailand.” Hunter Johnston said that he is unaware of any work the firm is currently doing, either in China or on behalf of the Chinese government.
A player to watch
Experts say economic concerns are going to dominate discussions about China in Congress in the next few years. “Economic problems are going to rise to the surface. Therefore, more Chinese firms will be turning for advice, lobbyists and consultants,” said Gill, the CSIS China expert. “Chinese companies want to invest here, and they don’t want to make mistakes.”
Along those lines, Hong Kong-based Hutchison Whampoa, owned by billionaire Li Ka-shing, hired Public Policy Impact Strategies to do public relations “in support of its image and brand in the United States,” records show. Hutchison Whampoa’s businesses include hotels, telecommunications and ports around the globe.
The conglomerate was in the news in early 2003 when former Reagan administration official Richard Perle resigned from the Defense Policy Board, an advisory panel to the Pentagon, amidst allegations of conflict of interest for his representation of companies with business before the Defense Department. Perle was a paid adviser to a bankrupt telecommunications company, Global Crossing, and his job was to persuade the Pentagon and other government agencies to approve the sale of the company to Hutchison Whampoa. The FBI and the Department of Defense objected to the purchase citing concerns about the company’s ties to the Chinese government.
Starting in 2004, Public Policy Impact Strategies arranged “courtesy visits” between Hutchison Whampoa officials and legislators to discuss “U.S.-China relations, international trade and telecommunications.” Among others, the Chinese businessmen met with Senate Majority Leader Bill Frist, R-Tenn., and Rep. Joe Barton, R-Texas, who chairs the powerful Energy and Commerce Committee.
“People confused Mr. Li with the PRC [People’s Republic of China],” said William Nixon, president of Public Policy Impact Strategies. “We are helping clear misunderstandings about who Hutchison Whampoa is and what they do.”
Nixon said that the misunderstandings began in the late 1990s, when Li bid for strategic port operations on both ends of the Panama Canal.
He compared Li’s relationship with the Chinese government with Bill Gates’ relationship with the U.S. government. “If Bill makes a call to the White House, someone will get back to him,” he said. “The same happens with Mr. Li in Beijing. They take him into consideration because they see him as someone important; they see him as the future.” Yet, Nixon said, Hutchison Whampoa doesn’t have ties to the Chinese government.
So far, Nixon said, the meetings between Hutchison Whampoa officials and congressman and senators have been “very positive.” He explained that Li “doesn’t lobby on legislation” and “doesn’t have immediate plans to invest in the United States. But I wouldn’t be surprised if in the future they are interested in buying a chain of health and beauty stores, for example.”
“Mr. Li is a very sweet man,” added Nixon as he talked about a $40 million donation the Hong Kong tycoon made in June to the University of California-Berkeley, the largest international gift in the university’s history, to build a biomedical and health sciences building. “I hope I work with him forever.”
Between May 2004 and April of this year, the public relations firm received $300,000.
An industry to watch
As the U.S. trade deficit with China has grown, textiles have become one of the most sensitive issues in the nations’ already complicated relations. A three-decade-old system of clothing and textile quotas expired Jan. 1, and Chinese textile imports in the United States surged 97 percent to $7.4 billion. When American manufacturers complained, the U.S. government put a 7.5 percent annual growth restriction on several categories of textiles from China, including shirts and trousers. This was allowed under China’s WTO entry agreement.
The Chinese Ministry of Commerce hurried to hire the law firm McDermott Will and Emery LLP, whose director of government relations, Paul Hatch, was a consultant to the Bush-Cheney 2004 campaign.
The law firm’s assignment from the Chinese government was to fight “the potential imposition of the threat-based safeguards on imports of textiles from China.”
The Justice Department lobbying filing says that McDermott lawyers would contact members of the executive branch and Congress, as well as the media. In a phone interview from Korea, Michael House, a partner in the firm’s International Trade Practice Group, said that the work for the Chinese Ministry of Commerce has been “strictly legal advice,” and that it finished in June when the Committee for the Implementation of Textile Agreements, an interagency group chaired by the Department of Commerce, resolved the safeguards cases in favor of the U.S. manufacturers. House didn’t comment on whether McDermott will do further work for the Chinese government on the textile disputes.
On Sept. 2, the fourth round of negotiations between the United States and China over garment imports broke down.
Meanwhile, domestic groups are getting ready for a counter-offensive on the China front.
Alan Tonelson, a research fellow at the U.S. Business and Industry Council, an organization that lobbies on behalf of small and medium U.S. companies, said “China will be our No. 1 priority now that the Central America Free Trade Agreement has passed.” The BIC opposed CAFTA and it strongly supports restrictions on Chinese textile imports.
“We expect to convert congressmen and their staffs to our own view point in trade policy,” said Tonelson.
Other issues that will keep legislators and lobbyists busy in the near future are China’s growing military presence and military intelligence, and new attempts by the Chinese government to acquire international capital, said Michael Wessel of the U.S-China Economic and Security Review Commission.
“The China issue is just an overwhelming one.”
Agustin Armendariz, Laura Arriaza, Alexander Cohen and Adela Maskova contributed to this report.