Harvard Case - The Eagle and the Dragon: The November 1999 US-China Bilateral Agreement and the Battle Over PNTR
"The Eagle and the Dragon: The November 1999 US-China Bilateral Agreement and the Battle Over PNTR" Harvard business case study is written by Charan Devereaux, Robert Lawrence. It deals with the challenges in the field of Negotiation. The case study is 43 page(s) long and it was first published on : Dec 7, 2004
The PNTR agreement was controversial in the United States. Some members of Congress argued that China should not be granted PNTR status because of its human rights record and its unfair trade practices. However, the Clinton administration argued that PNTR status was in the best interests of the United States. The administration argued that PNTR status would help to promote economic growth and job creation in the United States. It also argued that PNTR status would help to improve relations between the United States and China.
The PNTR agreement was eventually approved by Congress in a close vote. However, the agreement has remained controversial. Some members of Congress have continued to argue that China should not have been granted PNTR status. They argue that China has not lived up to its commitments under the agreement. They also argue that the agreement has led to job losses in the United States.
3. Analysis of the Case Study
The PNTR agreement has had a significant impact on the US-China relationship. The agreement has helped to increase trade between the two countries. It has also helped to improve relations between the two countries. However, the agreement has also been controversial. Some members of Congress have argued that China should not have been granted PNTR status. They argue that China has not lived up to its commitments under the agreement. They also argue that the agreement has led to job losses in the United States.The PNTR agreement is a complex issue with no easy answers. There are valid arguments on both sides of the issue. Ultimately, the decision of whether or not to grant China PNTR status is a political one.
4. Recommendaations
The United States and China should work together to develop a new bilateral trade agreement that addresses the concerns of both countries. The new agreement should be based on the principles of mutual respect, transparency, and fairness. It should also include provisions that promote economic growth, job creation, and environmental protection.The new agreement should be negotiated in a transparent and inclusive manner. All stakeholders, including businesses, labor unions, and environmental groups, should have a voice in the process. The agreement should also be subject to regular review to ensure that it is meeting the needs of both countries.
5. Basis of Recommendaations
The recommendations in this case study solution are based on the following considerations:- The United States and China are the world's two largest economies. A new bilateral trade agreement between the two countries would have a significant impact on the global economy.
- The PNTR agreement has been controversial in the United States. Some members of Congress have argued that China should not have been granted PNTR status. They argue that China has not lived up to its commitments under the agreement. They also argue that the agreement has led to job losses in the United States.
- The United States and China have different economic systems. The United States is a capitalist economy, while China is a socialist economy. This difference in economic systems can lead to misunderstandings and conflict.
- The United States and China have different political systems. The United States is a democracy, while China is a one-party state. This difference in political systems can also lead to misunderstandings and conflict.
6. Conclusion
The United States and China are two of the most important countries in the world. A new bilateral trade agreement between the two countries would have a significant impact on the global economy. It is important that the two countries work together to develop an agreement that is fair and beneficial to both sides.7. Discussion
There are a number of other alternatives that could be considered in addition to the one recommended in this case study solution. One alternative would be to simply maintain the status quo. This would mean that the United States and China would continue to trade under the terms of the current PNTR agreement. However, this alternative is not likely to be satisfactory to either country.Another alternative would be to terminate the PNTR agreement. This would mean that the United States would no longer treat China as a 'most-favored nation' in terms of trade. This would likely lead to a decrease in trade between the two countries. It could also lead to an increase in tensions between the two countries.
A third alternative would be to renegotiate the PNTR agreement. This would allow the two countries to address the concerns that they have with the current agreement. However, it is not clear whether the two countries would be able to reach an agreement that is satisfactory to both sides.
8. Next Steps
The next step is for the United States and China to begin negotiations on a new bilateral trade agreement. The two countries should work together to develop an agreement that is fair and beneficial to both sides. The agreement should be based on the principles of mutual respect, transparency, and fairness. It should also include provisions that promote economic growth, job creation, and environmental protection.Hire an expert to write custom solution for HBR Negotiations case study - The Eagle and the Dragon: The November 1999 US-China Bilateral Agreement and the Battle Over PNTR
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Case Description
On December 11, 2001, China became a member of the World Trade Organization. Many say the 1999 US-China bilateral trade agreement and the vote in Congress to permanently establish normal trade relations with China paved the way for China''s WTO accession. Even though China was not a WTO member, the United States had granted China Most Favored Nation trading status (MFN) since 1979. However, under US law, China''s trade status required an annual renewal that often became a focal point in Congress for protests over human rights issues, security concerns, and the growing US trade deficit with China. In order to support China''s WTO accession, the United States had to commit to non-discriminatory treatment by agreeing to make China''s MFN status permanent-known as PNTR or Permanent Normal Trade Status-thereby giving up the right to annual reviews. The vote in Congress generated a lobbying battle on Capitol Hill of historical proportions. Why did PNTR pass? What role should trade agreements play in promoting human rights, enhancing domestic reform, encouraging the rule of law, and promoting national security? How were the US-China bilateral agreement and the PNTR vote linked to other key negotiations? What is the role of trade in advancing America''s economic interests? (Revised August 2005) HKS Case Number 1771.0
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