NPC CHAIRMAN WU BANGGUO DISCUSSES PROMOTING

UNCLAS SECTION 01 OF 04 BEIJING 000696

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TAGS: PREL ETRD EFIN KIPR CH
SUBJECT: NPC CHAIRMAN WU BANGGUO DISCUSSES PROMOTING
BILATERAL TIES WITH U.S.-CHINA WORKING GROUP MEMBERS


Summary
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1. (SBU) Congressional U.S.-China Working Group
Representatives Mark Kirk, Rick Larsen and Tom Feeney
discussed bilateral relations, Taiwan and economic
issues with National People's Congress Chairman Wu
Bangguo on January 10 at the Great Hall of the People.
Representative Kirk outlined the Working Group's
mission and specific initiatives, noting that it hoped
to move bilateral relations forward through tangible
cooperation and frank discussion. Representative
Feeney asked about China's plans for improved IPR
protection. Wu emphasized China's focus on
maintaining stable cooperative relations with the
United States, outlined lingering concerns over Taiwan
and cited Chinese improvement in IPR protection, but
said it would require a gradual process. He noted
China's willingness to cooperate on issues of U.S.
concern including non-proliferation, the DPRK and
Iranian nuclear issues. China opposes Iran having a
nuclear weapons program. In response to
Representative Larsen's question about China's
internal development, Wu said China is pursuing
scientific development in order to change its growth
model and address imbalances that have emerged from
the rapid development of recent years. Wu encouraged
continued and deepening cooperation and exchanges
between the NPC and the U.S. Congress. End Summary.

Focus on U.S.-China Relations
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2. (SBU) National People's Congress (NPC) Chairman Wu
Bangguo welcomed members of the House of
Representatives U.S.-China Working Group and cited
appreciation for their active work since he met with
them in New York in September 2005. Representative
Mark Kirk cited the Working Group's goal of making the
U.S.-China relationship a top priority in Congress.
Representative Rick Larsen described the Working
Group's activities, noting a focus on maintaining
bipartisan support for the relationship, educating
Members about U.S.-China issues and maintaining a
frank and open dialogue with Chinese counterparts
about ways to move forward, both on areas of common
interest and areas where we have differences. Noting
that the U.S.-China relationship would be the most
important of the 21st century, Representative Tom
Feeney welcomed China's efforts to strengthen
relations with the United States and particularly with
the U.S. Congress.


3. (SBU) Wu responded to Representative Kirk's
question about Chinese views on a successful Summit
meeting in Washington in April by stressing the
importance of stable U.S.-China relations for China's
overall development. A hallmark of such stable
relations is the continuing dialogue between the top
leaders of the United States and China. President
Bush and President Hu met five times in 2005 and China
is very much looking forward to a successful Summit in

2006. While it is not strange that the United States
and China have differences, common interests far
outweigh those differences. The differences should
not be politicized or be allowed to stand in the way
of improving ties.


4. (SBU) Wu expressed appreciation for the need for
China to be engaged with Members of Congress directly.
China follows the U.S. political system closely, but
there are many voices in Congress and often media
reports are incorrect. The NPC has established
exchange mechanisms with both Houses of Congress and
the Working Group's efforts have been important in
furthering exchanges and communication. In 2005, the
NPC hosted 98 Congressional Members, Wu said, noting
that he hopes more Members will come in the future,
contributing to improved communication and a calmer
approach to the relationship.

More Relaxed in Taiwan but Concern Remains
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5. (SBU) As to China's hopes for the Summit, Wu said

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it was difficult to answer directly. China hopes to
maintain the momentum of meetings between President
Bush and President Hu. Each side should give due
consideration to the other's concerns and Taiwan
remains China's biggest concern. The cross-Strait
situation has developed in a more relaxed way
recently. The Chinese Government took a two-part
approach to cross-Strait relations in 2005. The first
part was passage of the anti-secession law while the
second was to promote exchanges with Taiwan's
opposition Party leaders. Wu noted that there has
been a change in popular will in Taiwan that shows a
shift away from support for Taiwan independence, as
evidenced in the results of the December mayoral
elections.


6. (SBU) China remains concerned, however, as the
root cause of cross-Strait tensions has not yet been
eliminated. Chen Shui-bian stated in his New Year
speech that Taiwan is an independent country whose
prospects will not be decided by the 1.3 billion
people in China, but by the 23 million people on
Taiwan. He reiterated his determination to complete
his constitutional reengineering agenda by 2008, which
means there will be no tranquility in the Taiwan
Strait. While the Mainland is trying to promote
closer ties, Chen put forward measures to create more
obstacles, Wu stated. The most important issue is to
oppose and contain Taiwan independence, an issue on
which the United States and China share common
interests.


7. (SBU) Reiterating China's hopes to hold an in-
depth dialogue on mutual concerns, Wu said that China
attaches importance to the same issues as the United
States. The United States and China have good
cooperation on counterterrorism, non-proliferation,
the DPRK nuclear issue, the issue of Iran's nuclear
weapons and UN reform. China agrees with the United
States and the European Union that Iran should not
have a nuclear weapons program, Wu said. China gives
full consideration to U.S. concerns in these areas and
also attaches importance to economic issues such as
the exchange rate, the trade deficit and IPR
protection.

China's Internal Development
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8. (SBU) Representative Larsen asked about
developments inside China and how the government plans
to deal with challenges in rural areas including
unbalanced development. Wu said that while China has
grown rapidly since 1978 to become the sixth largest
economy in the world, problems have now emerged with
China's development model. This is being addressed by
President Hu Jintao and the central leadership through
a new focus on "scientific development" and a
"harmonious society," Wu stated. During its visits to
Gansu province and Shanghai, the delegation will have
an opportunity to see firsthand the extreme
discrepancy in development.


9. (SBU) China's capital-intensive growth model must
also be changed, Wu stated. Only 3.9 percent of
China's growth can be attributed to technological and
scientific contributions whereas the same figure in
the United States is 70 percent, Wu said. The Chinese
leadership just held a national conference on science
and technology where it put forward a program of S&T
development up until 2020. In the future, China must
pay more attention to the quality, structure and
efficiency of its economic growth.


10. (SBU) Wu told the Members that the Chinese
leadership is all too aware of China's problems.
Urban areas need to create 10 million jobs a year, 24
million people will be looking for jobs each year, 60
million disabled people need to be taken care of and
26 million people in rural areas live on less than
fifty cents a day. While the most discussed problem
of rural areas used to be how to improve agriculture,
now China needs a coordinated plan for the development
of rural and urban areas simultaneously. The
leadership is working collectively on all these

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problems.


11. (SBU) Taking a moment to address concerns about a
China threat, Wu said that China's development will be
continuous and irreversible. However, both China and
India have played a constructive role in the world
economy. China needs a peaceful international
environment to pursue its development, which requires
favorable relations with other countries, particularly
the United States. This is why China emphasizes
cooperation and solving problems. As EVFM Dai told
Deputy Scretary Zoellick, China is not the former
Sovit Union. It will not pursue an arms race or
xpansionism. History has proved this road is adead
end and China's history and cultural background would
be inconsistent with such a curse. China has a win-
win principle in develping relations with other
countries and the next five years will be an important
milestone in China's development, including economic,
political, cultural and social development.

IPR Protection Prospects
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12. (SBU) Representative Feeney noted that while
there are different views on China in the United
States, one area where all parties seem to agree is on
the inadequacy of IPR enforcement in China. Asked how
China will go about ensuring that intellectual
property protection meets international standards, Wu
said that the importance of protecting intellectual
property was featured in President Hu's speech at the
national S&T conference. China is working to increase
the proprietary ability of its own companies and
recognizes the importance of IPR protection for
enhancing creativity. China increased IPR
investigations in 2005 and issued a judicial
interpretation that lowers the judicial threshold for
IPR protection. It created a leadership group led by
Vice Premier Wu Yi and considered 2,600 IPR court
cases in 2005. These efforts are sincere, but many
people are willing to circumvent the laws for profit
and a gradual process will be required. The
environment will become more and more strict, Wu
predicted, concluding by appealing for loosening
restrictions on exports of high-tech products to
China.


13. (SBU) Representative Kirk concluded the meeting
by reviewing initiatives the Working Group is pursuing
during its visit, including:

-- joint rescue capabilities in the area of space
programs,

-- establishment of a telephone hotline between the
Ministry of Defense and the Defense Department,

-- establishment of the IPR Ombudsman position in the
Chinese Embassy in Washington (Wu said the Ombudsman
would take up his duties on January 14),

-- an American professional football exhibition game
in Shanghai,

-- a cultural exchange marking the Year of China in
Chicago in 2010,

-- increasing student exchanges, particularly bringing
American students to China and

-- an international audit of licensed software use by
Chinese government entities.


14. (SBU) Wu offered general support for further
initiatives and exchanges. On the issue of legal
software, he said the Finance Ministry has earmarked
250 million RMB in 2006 for purchase of legal software
by local governments. Representative Kirk praised
this initiative, but reiterated the importance of a
reliable audit.


15. (U) Participants:

U.S. Delegation

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Representative Mark Kirk
Representative Rick Larsen
Representative Tom Feeney
DCM David Sedney
Steve Orlins, President, National Committee on U.S.-
China Relations
Richard Goldberg, Co-Staff Director, U.S.-China
Working Group
Dr. Yang Hong, Bryant University
Embassy Control Officer
Embassy Notetaker

Chinese Delegation
--------------
NPC Chairman Wu Bangguo
NPC Foreign Affairs Committee Chairman Jiang Enzhu
NPC Foreign Affairs Comm. Vice Chairman Lu Congmin
DCM Chinese Embassy in Washington Su Ge
Staff and Interpreter


16. (U) The Delegation has cleared this cable.
Randt