Kissinger Warned China That American Anger Over Hostage Situation Could Jeopardize Billions In Trade

Defense Secretary Rumsfeld to Propose Shifting

Defense Resources Away From Europe And Toward Asia



Apr 15, 2001, 01:00 ET from Newsweek

    NEW YORK, April 15 /PRNewswire/ -- Chinese leaders understood that the
 American letter about the EP-3E crisis fell well short of a real apology or of
 meeting Beijing's demand that the United States stop its spy flights off the
 Chinese coast, but accepted the letter as an apology partly because of private
 signals delivered by influential third parties who represent American business
 interests.  Former Secretary of State Henry Kissinger warned the Chinese that
 American anger over a hostage situation could jeopardize the $116 billion a
 year of trade between the two countries, the April 23 issue of Newsweek
 reports (on newsstands Monday, April 16).
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010415/HSSU001 )
     Relatedly, a massive review of Pentagon priorities by Secretary of Defense
 Donald Rumsfeld is looking squarely at the threat posed by the Chinese, report
 Assistant Managing Editor Evan Thomas and National Security Correspondent John
 Barry.  It is likely, Pentagon sources tell Newsweek, that Rumsfeld will
 propose a shift of defense resources away from Europe and toward Asia.
     President Bush was somewhat surprised when the EP-3E was not returned
 within a couple of days of the collision, and he then dropped his initial show
 of public pique and turned to quiet and disciplined diplomacy.  According to
 administration sources, the president's instructions to Secretary of State
 Colin Powell were terse but clear:  "You can negotiate this, but don't accept
 blame."
 
 

SOURCE Newsweek
    NEW YORK, April 15 /PRNewswire/ -- Chinese leaders understood that the
 American letter about the EP-3E crisis fell well short of a real apology or of
 meeting Beijing's demand that the United States stop its spy flights off the
 Chinese coast, but accepted the letter as an apology partly because of private
 signals delivered by influential third parties who represent American business
 interests.  Former Secretary of State Henry Kissinger warned the Chinese that
 American anger over a hostage situation could jeopardize the $116 billion a
 year of trade between the two countries, the April 23 issue of Newsweek
 reports (on newsstands Monday, April 16).
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010415/HSSU001 )
     Relatedly, a massive review of Pentagon priorities by Secretary of Defense
 Donald Rumsfeld is looking squarely at the threat posed by the Chinese, report
 Assistant Managing Editor Evan Thomas and National Security Correspondent John
 Barry.  It is likely, Pentagon sources tell Newsweek, that Rumsfeld will
 propose a shift of defense resources away from Europe and toward Asia.
     President Bush was somewhat surprised when the EP-3E was not returned
 within a couple of days of the collision, and he then dropped his initial show
 of public pique and turned to quiet and disciplined diplomacy.  According to
 administration sources, the president's instructions to Secretary of State
 Colin Powell were terse but clear:  "You can negotiate this, but don't accept
 blame."
 
 SOURCE  Newsweek