Investment Means Prosperity, Peace, Cohen Tells Shanghai Stock Traders

Defense Secretary William S. Cohen speaks at the Shanghai Stock Exchange July 14, during a visit to the People's Republic of China. Cohen told local business people free and open trade is the greatest hope of reducing tensions in Asia. Photo by Linda D. Kozaryn.   (Click photo for screen-resolution image);high-resolution image available.

Cohen arrived in Shanghai after conferring for three days with national leaders. The secretary's visit was intended to fully restore military-to-military ties, severed by the Chinese last year following the accidental bombing of their embassy in Belgrade, Yugoslavia, during NATO Operation Allied Force.

Cohen addressed the stock exchange after meetings with Shanghai Mayor Xu Kuangdi and Wang Daohan, chairman of the Association for Relations Across the Taiwan Strait. Standing before high- tech display boards, he pointed out to 200 business people that stability attracts investment, which then generates prosperity.

"And prosperity, given time, builds democracy," he said.

The United States is deeply engaged in the Asia-Pacific region because of its strategic significance and its growing promise and prosperity, he said. "Both of our nations have an interest in an Asia that is strategically secure and stable, where trade investment and economic development can flourish," he said.

Cohen said the greatest hope of reducing tensions in Asia lies in free and open trade. China will change as it becomes a partner in the world economic system, he said. A prosperous economy will lead to improved human rights and increase people's exposure to new ideas, he noted.

"A growing, stock-owning Chinese middle class, in greater commercial and intellectual contact with the world, will do more to keep Asia peaceful, stable, and eventually democratic, than any action other nations could possibly take," he said.

In the dawn of the new century, he said, "it is again within China's grasp to open up to the world and embrace the benefits of free and open trade in industry and in ideas. All that is required to enjoy the benefits of free and open trade is the will to make the decision to embrace it."

The United States stands ready to welcome China to the world economic community, he said. U.S. efforts to promote stability have benefited all nations in the region, particularly China, he said.

Businessmen queried Cohen on the U.S. position regarding the reconciliation of China and Taiwan issue. As he has throughout his visit here, Cohen said the United States supports China's one-country, two-system plan, but it also is committed to Taiwan's self-defense, and he urged Chinese officials to "seize the moment of opportunity" presented by Taiwan's election of a new president.

Chinese officials have been equally consistent in their messages: They don't intend to use military force against Taiwan, but they reserve the right, and Taiwan's status is purely internal Chinese business. A senior U.S. official noted, though, that the tone and nature of China's discussion on Taiwan has changed in recent weeks.

Compared to the feeling of crisis that arose prior to Taiwan's March presidential election, he said, discussions now seem more relaxed, constructive and forward-looking. Chinese officials now express the desire for mutual consultations to achieve one China, he noted, and both sides seem to be working out how to begin a dialogue.