FIRST came MacDonalds, bringing Americana to Chinese main streets. Now the Chinese family car pulling up for Big Macs could be a Buick sedan, following the signing of a $1.57 billion contract in Beijing yesterday between General Motors of the United States and China's state-owned Shanghai Automotive Industry Corporation.
The General Motors agreement was one of two multi-million dollar deals involving American industrial giants signed yesterday in Beijing in the presence of US Vice president, Mr Al Gore. In the second, Boeing agreed to sell five 777 wide-bodied jets worth $685 million to China's international carrier, Air China.
The agreement to mass produce Buicks for the Chinese market was timed for Mr Gore's visit as a response to domestic "show-me-the-money criticism of the Clinton Administration's engagement with China, and partly as a concrete symbol of improving ties between the US and China.
Officials dismissed reports that Mr Gore hesitated to attend the signing ceremony because of a controversy over campaign fundraising in the US, specifically involving Mr Gore. The FBI is investigating allegations, denied by Beijing, that Chinese money was helped fund President Bill Clinton's campaign in 1996.
"These agreements are proof positive that there is greater economic cooperation between the United States and China," said Ginny Terzano, Mr Gore's press secretary.
The Shanghai General Motors plant will start production next year with a target capacity of 100,000 Buick sedans a year, and will produce 50,000 cars a year by 2000, GM chairman, Mr John Smith, told a Beijing press conference. The US cars will compete with domestically produced Audis and Red Flags and imports of Jaan's Lexus. The agreement was signed in a ceremony in the Great Hall of the People by Mr Smith and Mr Chen Xianglin, president of Shanghai Automotive.
Mr Gore's visit to China - the highest-level US visit since Vice President, Mr George Bush, in early 1989 - had helped to put the final stamp of approval on the deal, which had been in the works since 1994, Mr Smith said.
The US car-maker failed however to gain a sought-after exemption from a duty on imports of goods. This will affect initial profits as the new firm, Shanghai GM, will import nearly $1.6 billion worth of US goods.
The Boeing deal had also been delayed by politics, Mr Ronald Woodard, president of Boeing Commercial Airplane Group, said. Under the contract, three of the 7775 are to be delivered to Air China by the end of 1998 and the other two in 1999.
However, Boeing hoped to sell China 10 of the twin-engined jets and the modest size of the order has left the door open to European competition. The US company is in hot competition with Airbus Industrie for the Chinese market. Boeing has sold 216 planes to China compared to 29 of the narrow-body A330-300 Airbus. China needs 240 more passenger aircraft to meet its growing air transport needs by the year 2000.
Beijing is wary of alienating its European trade partners at the expense of improved ties with the US and an order for more Airbus sales may be signed during the forthcoming visit to Beijing of the French Prime Minister, Mr Jacques Chirac.
Mr Gore is officially in China as a guest of the Prime Minister, Mr Li Peng. He is preparing for a Sino-US summit in Washington later this year and a visit to China by President Clinton in early 1998. He meets President Jiang Zemin today on the second day of his four-day visit.
"We had a very productive and energetic talk," Mr Gore told reporters after meeting Mr Li in the Great Hall of the People.
"The meetings today were very positive. Both sides have a desire to lend forward momentum, recognising areas where we agreed to disagree."
Those areas include human rights and Taiwan. Beijing police have told imprisoned dissidents' close relatives not to leave their homes during Mr Gore's visit.
Mr Gore also visited a school in Beijing yesterday to discuss the environment - his pet project - with the children. He presented the teacher with a paperback copy of his book Earth in the Balance.