This report discusses congressional interest in the leadership change and economic transformation underway in China, which has grown substantially over the past two years. Leading congressional concerns focus on how economic conditions in China pose opportunities for U.S. enterprise and how the evolution of conditions in China foster U.S. security, economic, and political interests. Congressional concern with China grew in 1995 as a result of reports of the serious decline in the health of senior Chinese leader Deng Xiaoping.

This report discusses the background information and most recent development in U.S.-China relations since mid-1996. The relations also have been marred by continuing allegations of Chinese espionage, ongoing controversy over human rights, charges that China continues to violate its non-proliferation commitments, controversy over the accidental NATO bombing of the Chinese Embassy in Belgrade, and renewed tensions over Taiwan. The report describes current issues in U.S.-China relations such as; Human Rights Issues, Issues in U.S.-China Security Relations, Economic Issues, and Sovereignty Issues: Taiwan, Tibet, Hong Kong.