The Cost of Putting Business First

July 1996, Vol. 8, No. 7 (C)



China is increasingly using trade and diplomatic reprisals to silence human rights criticism, and governments around the world, when thus forced to choose between principle and profit, are putting business first. In March 1996, France, anxious for China to sign a contract for Airbus planes, argued within the European Union against a resolution in the United Nations Commission on Human Rights urging improvement of Chinese human rights practices. In early June, German Foreign Minister Kinkel’s visit to Beijing was canceled by Chinese authorities to protest a German parliamentary resolution adopted in Bonn condemning China’s human rights record in Tibet. The German government responded by putting off two other scheduled official visits to China, but Beijing’s action provoked a furious debate in Germany over the impact of the dispute on that country’s lucrative business dealings with China.

The perceived conflict between human rights and trade was perhaps best symbolized by U.S. President Bill Clinton’s decision in May 1994 to abandon any effort to place human rights conditions on China’s Most Favored Nation (MFN) trade status, arguing that a tough human rights policy was hampering the ability of the U.S. to pursue trade and security interests. His unconditional renewal of MFN marked the end of effective international pressure on China to improve its human rights practices and the triumph of commercial diplomacy, with its self-serving premise that free enterprise leads to a free society.

Two years later, the market economy in China is booming but there is little evidence of a freer society or greater respect for human rights. On the contrary, China’s small but formerly vibrant dissident community has been all but crushed, repression of nationalist and ethnic minority movements is the most severe in years; an intense crackdown is underway against all forms of unauthorized religious belief and worship; and the numbers of judicial executions in China are now greater than at any time since 1983. In fact, as China grows stronger economically, the government is using its newfound clout not to improve human rights but to resist human rights pressure through intimidation and commercial threats.

But there are telling signs that the same factors that produce serious abuses of human rights in China are also detrimental to trade, including a flouting of the rule of law that leaves businesspeople and economic reformers increasingly vulnerable to the types of arbitrary detention customarily meted out to dissidents, and strict controls on politically “sensitive” information, including economic data. In addition, a major crackdown on crime that began in April 1996 appears to be creating not the intended enhanced sense of security, but widespread fear and uncertainty that anyone, anywhere can run afoul of the pressure on local officials to make arrests. Actions by Chinese authorities with respect to the press, the courts, and the legislature in Hong Kong raise serious concerns about whether that haven of free enterprise will be as attractive to the international business community after 1997. Stepped-up repression of nationalist movements in Tibet, Inner Mongolia and particularly Xinjiang — potentially China’s major oil-producing region — has an obvious negative impact on local economy and investment climate. The Chinese government’s refusal to allow international humanitarian agencies, or for different reasons, the U.S. Customs Service, access to its prison system is not only detrimental to the health and well-being of prisoners; it is also symptomatic of a lack of transparency in Chinese government procedures that has implications for trade and security as well. The lesson from all this may not be that freer trade produces a freer society, but that failure to protect human rights can be very bad for business.

The one potentially positive development with respect to human rights over the last twelve months is a series of reforms of the criminal procedure law enacted in March 1996 by the National People’s Congress. Among other things, those reforms for the first time appear to partially institute the principle of presumption of innocence, a key building block of a fair legal system. While their importance should not be underestimated, neither should it be assumed that reforms on paper will automatically lead to protections in practice; indeed, the wholesale disregard for due legal process displayed by police and judicial authorities in the current anti-crime campaign makes a mockery of the recently enacted reforms. Moreover, the modest legislative gains that those reforms represent were almost certainly the product of a combination of domestic and international pressure. To diminish the latter would be to set back efforts to strengthen the rule of law—efforts that are clearly in the interests of potential investors as much as of beleaguered dissidents.



To the Government of the People’s Republic of China:
End all forms of arbitrary detention through further reforms of the revised Criminal Procedure Law and the newly enacted Administrative Punishment Law and use the spirit of those reforms to review the cases of all political and religious prisoners judicially or administratively sentenced for non-violent activities with a view toward their release.

Permit international access and monitoring of trials, including political trials, with a specific view to assessing the implementation of the reforms and encouraging ways in which procedural safeguards can be further strengthened.

Encourage the U.N. Working Group on Arbitrary Detention to evaluate current practices with regard to arrest and detention procedures and recommend safeguards that would prevent, for example, the practice of failing to inform family members about the whereabouts of detained relatives. The visit of the Working Group would be a useful opportunity to provide a full accounting of the charges, whereabouts and legal status of those detained, arrested or sentenced in connection with political and religious activities.

Extend invitations to the various U.N. thematic mechanisms responsible for human rights: the Special Rapporteurs on, respectively, Torture, Freedom of Expression, Independence of the Judiciary, Violence Against Women and (for a second visit) Religious Intolerance.

Define very specifically the meaning of “deprivation of political rights” as outlined in Article 50 of the Criminal Law and eliminate those provisions that violate international human rights standards. Cease discrimination against released political prisoners and permit them to return to their studies or their jobs. Eliminate obstacles to employment in their chosen fields.

Ratify the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights.

Allow full access of international humanitarian organizations to political or religious prisoners and detainees.

Ease controls of religious activities throughout China and Tibet that violate the right to freedom of religion and association and halt church registration, demolition of religious buildings and controls on religious publications.

To the International Community:
Governments of the G-7 countries should develop a joint, long-term multilateral strategy for strengthening the rule of law and improving human rights practices in China. That strategy should have as four of its objectives access by international humanitarian organizations to Chinese and Tibetan prisoners; elimination of administrative detention, building on legal reforms made by the National People’s Congress in March 1996; release of prisoners arbitrarily detained for non-violent political, religious and economic activities; and ratification of or accession to key international human rights treaties, including the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights. Governments in the G-7 should agree to promote this common human rights agenda using a combination of bilateral and multilateral tools. Discussion of China’s progress towards meeting these objectives should be a regular item for the annual G-7 summit meetings.

Parliaments should attach specific human rights and trade conditions to their governments’ approval of China’s bid to join the World Trade Organization. The Chinese government’s behavior as a reliable trading partner cannot be separated from its willingness to comply with universal human rights norms. Parliaments should require certification that Beijing has taken verifiable steps both to liberalize its trade and investment rules and to improve human rights by meeting the objectives outlined above.

Governments should urge China to fully cooperate with the U.N. Working Group on Arbitrary Detention, due to visit China in July, and to implement both the Working Group’s recommendations and those made by the special rapporteurs on religious intolerance and torture.

G-7 governments should consider ways of exerting informal leverage to prevent consideration of major non-basic human needs loans to China by the World Bank’s board of directors. It is expected that during the fiscal year ending in June 1996, China will have received nearly $2.9 billion from the Bank, more than any other country. At the same time, the G-7 countries should support efforts to strengthen the legal system in China, moving beyond support for the development of commercial law to a broader concern with criminal law and procedure and the creation of an independent judiciary.

One year prior to the transition of Hong Kong to Chinese sovereignty on July 1, 1997, parliaments in the U.S., Europe, Canada, Australia and elsewhere should adopt strong resolutions protesting Beijing’s proposal to abolish the elected Legislative Council (Legco) in Hong Kong and to replace it with an appointed body. Resolutions should also call on China to fully comply with its international obligations as outlined in the Joint Declaration by allowing the current Legco members to serve their full four-year terms.

Japan and the U.S. have a particular responsibility to press China for human rights improvements in light of their key economic relationships with China. The U.S. is the largest single market for China’s exports, and Japan is China’s number one bilateral aid donor. In 1996, Beijing began receiving from Tokyo the first installment of a new $6.8 billion three-year ODA (Official Development Assistance) loan package. Japan should consider ways of increasing its attention to human rights in its bilateral relations with China, for example by raising human rights concerns during ODA talks with Chinese authorities, and beginning a formal bilateral human rights dialogue on specific cases such as Chen Ziming, Bao Tong, and Wei Jingsheng. The U.S. should make it clear in all high-level exchanges that a Sino-U.S. summit can take place only if there are meaningful steps taken to improve human rights in China and Tibet.

There is an urgent need for increased monitoring of the deteriorating human rights conditions in Tibet. Governments should upgrade their diplomatic presence in Chengdu,. adding additional Tibet-speaking staff assigned to conduct monitoring and reporting of abuses in Tibet. In addition, governments should consider making formal requests to Beijing for permission to open permanent consular missions in Lhasa. An international diplomatic presence in the Tibetan capital could act as a deterrent to the commission of human rights violations in the region.

The World Bank and other lending agencies that have regular access to Xinjiang should use their influence to urge the Chinese government to open up Xinjiang to foreign journalists and human rights monitors.









Inner Mongolia






Human Rights Watch      July 1996      Vol. 8, No. 7 (C)

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