Identifier
Created
Classification
Origin
08BEIJING1160
2008-03-27 09:00:00
CONFIDENTIAL
Embassy Beijing
Cable title:  

U.S.-CHINA COUNTERTERRORISM DIALOGUE: CSI,

Tags:  PTER PREL EFIN ECON ENRG KNNP ASEC TW CH 
pdf how-to read a cable
VZCZCXRO5897
OO RUEHCN RUEHGH RUEHVC
DE RUEHBJ #1160/01 0870900
ZNY CCCCC ZZH
O 270900Z MAR 08
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6114
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUEHAS/AMEMBASSY ALGIERS 0342
RUEHGB/AMEMBASSY BAGHDAD 0159
RUEHDM/AMEMBASSY DAMASCUS 0319
RUEHIL/AMEMBASSY ISLAMABAD 6673
RUEHBUL/AMEMBASSY KABUL 0389
RUEHNT/AMEMBASSY TASHKENT 1158
RUEHTRO/AMEMBASSY TRIPOLI 0013
RUEHKP/AMCONSUL KARACHI 0067
RUEHLH/AMCONSUL LAHORE 0036
RUSBPW/AMCONSUL PESHAWAR 0125
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEKJCS/SECDEF WASHINGTON DC
RUEAIIA/CIA WASHINGTON DC
RHMFISS/DEPT OF HOMELAND SECURITY WASHINGTON DC
RHMFISS/FBI WASHINGTON DC
RUEAORC/US CUSTOMS AND BORDER PROTECTION WASHINGTON DC
RHEHNSC/NSC WASHDC
C O N F I D E N T I A L SECTION 01 OF 03 BEIJING 001160 

SIPDIS

SIPDIS

E.O. 12958: DECL: 03/27/2033
TAGS: PTER PREL EFIN ECON ENRG KNNP ASEC TW CH
SUBJECT: U.S.-CHINA COUNTERTERRORISM DIALOGUE: CSI,
MEGAPORTS, TERRORIST FINANCE, OVERSEAS THREATS TO CHINESE
(PART 2 OF 4)

BEIJING 00001160 001.2 OF 003


Classified By: Deputy Political Section Chief Ben Moeling. Reasons 1.4
(b) and (d).

SUMMARY
-------

C O N F I D E N T I A L SECTION 01 OF 03 BEIJING 001160

SIPDIS

SIPDIS

E.O. 12958: DECL: 03/27/2033
TAGS: PTER PREL EFIN ECON ENRG KNNP ASEC TW CH
SUBJECT: U.S.-CHINA COUNTERTERRORISM DIALOGUE: CSI,
MEGAPORTS, TERRORIST FINANCE, OVERSEAS THREATS TO CHINESE
(PART 2 OF 4)

BEIJING 00001160 001.2 OF 003


Classified By: Deputy Political Section Chief Ben Moeling. Reasons 1.4
(b) and (d).

SUMMARY
--------------


1. (C) At the March 25 U.S.-China Counterterrorism Dialogue
in Beijing, the U.S. and Chinese delegations, led
respectively by U.S. Ambassador at Large for Counterterrorism
Dell Dailey and MFA International Organizations and
Conferences Department Director General Wu Hailong, agreed
that the United States and China made progress in advancing
counterterrorism cooperation through the Container Security
Initiative (CSI) and the Megaports program. China sought
U.S. agreement to expand bilateral CSI cooperation to monitor
shipments of solid waste from the United States to China by
initially dispatching five Chinese customs officials to two
U.S. ports. The United States recognized China's progress in
improving its counterterrorist finance regime, while both
sides agreed that China must amend legislation to allow for
more rapid seizure of terrorist assets. DG Wu discouraged
U.S. efforts to formalize Megaports and CSI cooperation with
Taiwan under the banner of counterterrorism. Ambassador
Dailey reaffirmed the U.S. one China policy, but considered
this issue a political issue separate from a counterterrorism
issue. DG Wu also briefed on the rising threat of
"terrorism" to overseas Chinese citizens, which he said
resulted in the deaths of 40 Chinese nationals in 2007. End
Summary.

CSI and Megaports Cooperation Progressing Smoothly
-------------- --------------


2. (C) At the March 25 U.S.-China Counterterrorism Dialogue
in Beijing, General Administration of China Customs (GACC)
Director Dang Xiaohong praised U.S.-China cooperation in
implementing the Container Security Initiative (CSI) and in

establishing a pilot Megaports program at the Yangshan
Deepwater Port in Shanghai. She noted that Chinese ports
participating in CSI have received high marks in assessments
conducted by U.S. officials.


3. (C) Dang also sought U.S. cooperation in expanding
bilateral CSI cooperation by monitoring shipments of solid
waste from the United States to China. Such a program would
be based on U.S. overseas CSI operations and would initially
involve the dispatch of five Chinese customs officials to two
U.S. ports. The officials would be responsible for
cooperating with U.S. authorities to check and verify solid
waste cargo destined for China. Embassy Beijing Customs and
Border Protection (CBP) Representative responded that this
issue has been under discussion since December 2007, and that
CBP is still waiting for a specific proposal from GACC.
Ambassador Dailey and DG Wu encouraged customs agencies and
border protection authorities from both countries to engage
in further discussion of this issue. Dailey noted he was
uncomfortable including "solid waste cargo" in
counterterrorism discussions.

China Opposes Formal U.S.-Taiwan CT Cooperation
-------------- --


4. (C) DG Wu stated China's opposition to what it perceives
as U.S. moves to develop official cooperation with Taiwan
under the auspices ofcounterterrorism. He expressed concern
aboutthe execution of the Megaports and CSI programs in
Taiwan under the banner of counterterrorism without first
consulting with China. Wu said he believes that if the
United States does not address the Taiwan question in the
Counteterrorism Dialogue, it could have a negative affect on
bilateral counterterrorism cooperation in the future. He

BEIJING 00001160 002.2 OF 003


asked the United States to "abide by the one China policy"
and discouraged any U.S. efforts to formalize
counterterrorism cooperation with Taiwan through multilateral
organizations, in particular APEC. Ambassador Dailey assured
DG Wu that the United States takes China's concerns seriously
and reaffirmed the United States commitment to our one China
policy based on the three joint communiques and the Taiwan
Relations Act. However, he stressed this issue is a
political issue separate from counterterrorism issues. He
warned that our Counterterrorism Dialogue could lose
relevance if it begins to include a larger discussion of
broad issues such as this. Issues that have a minimal
counterterrorism application should not be added to the
counterterrorism portfolio.

Counterterrorist Finance Moving in the Right Direction
-------------- --------------


5. (C) Embassy's Minister Counselor for Financial Affairs
noted that China made strides over the past 18 months in
strengthening its counterterrorist finance regime, in
particular by enacting a comprehensive anti-money laundering
law in 2006 and by joining the Financial Action Task Force
(FATF) in 2007. He pointed out that the United States worked
hard to support China's membership in the FATF even though
China had been found non-compliant with a number of the
FATF's core requirements. He explained that China does not
have a law criminalizing terrorist activities. In addition,
China lacks laws that enable it to implement UN obligations
by quickly freezing the assets of terrorists and terrorist
organizations listed by the UN 1267 committee. These
weaknesses leave China's financial sector vulnerable to abuse
by terrorist organizations, he explained.


6. (C) People's Bank of China (PBOC) Anti-Money Laundering
Department Director Hao Xiangjie thanked the United States
for its support of China's membership in the FATF and
reported that the PBOC has developed an interagency action
plan aimed at addressing the weaknesses in China's AML/CTF
system noted by the FATF. Hao stated that the PBOC already
has a team in place to draft an amendment to the laws that
criminalize terrorism. The PBOC will allow FATF members to
review the draft amendment prior to its submission to the
National People's Congress in June of this year. Hao said
the PBOC shares the FATF's concerns about the timely freezing
of terrorist assets. The PBOC will soon convene a working
group that will incorporate all parties involved in this
issue, including the Ministry of Justice, the Ministry of
Public Security and the MFA. Hao emphasized that it will
take a long time to propose and pass amendments to laws on
terrorist finance, but she noted that the PBOC is already
able to issue guidance to banks to notify them of potential
threats, including by distributing the names of UN-designated
terrorists and terrorist organizations to Chinese banks. In
addition to its efforts to strengthen counterterrorist
finance legislation, the PBOC is leading efforts to increase
information sharing between banks and law enforcement
agencies, Hao reported.

Terrorist Threat to Overseas Chinese on the Rise
-------------- ---


7. (C) DG Wu said he is concerned by the rising threat of
terrorism to overseas Chinese citizens. In 2006,
approximately 34.52 million Chinese nationals traveled to or
resided in over 200 countries. Chinese enterprises are also
expanding overseas, with over 10,000 Chinese-owned businesses
currently operating beyond China's borders. Since 2003,
Chinese nationals have been the target of attacks in
Afghanistan, Niger, Pakistan, Sri Lanka and Ethiopia. In
2007 alone, 40 Chinese nationals were killed in terrorist

BEIJING 00001160 003.2 OF 003


attacks and 80 were wounded, Wu said. (Comment: Wu did not
offer a definition of what he considers terrorist attacks.
It is unclear whether the attacks he mentioned were committed
by known terrorist groups or whether they stemmed from civil
unrest, violent crime or a combination thereof.) Ambassador
Dailey told Wu that the United States faces similar
challenges in protecting American citizens overseas and said
the United States would be happy to engage in further
exchange of ideas on these issues. He explained to Wu how
the Overseas Security Advisory Council at U.S. embassies
works with the business community to promote security
awareness and noted that a similar program at Chinese
embassies could have a positive effect.


8. (U) The delegation has cleared this cable.
PICCUTA