Trade Negotiations Minister Jim Sutton today welcomed the United States Senate's approval of permanent normal trade relations with China.

Yesterday, the Senate voted 83 to 15 in favour of normalising trade relations with China.

The bill, now passed by both houses in the United States Congress, now goes to United States president Bill Clinton to be signed. It will become effective once China joins the World Trade Organisation and implements the tariff reductions agreed to with WTO members as part of that accession.

Mr Sutton said New Zealand wanted to see China in the WTO and this vote was a further step towards that end.

"New Zealand concluded its bilateral deal with China some time ago we were the first OECD member to do so. However, that deal remains subject to the introduction of satisfactory tariff quota arrangements for wool. Discussions on this with the Chinese are continuing."

He said China was a huge market, with more than 1 billion people. New Zealand's future as a trading nation was tied with that of China and North Asia, but it was vital that international trade with such large nations was governed by rules that could be enforced.

Mr Sutton said United States president Bill Clinton's Administration had devoted considerable effort to securing yesterday's outcome.

"Now that the United States has completed this initative, the way will be open for the Administration to focus on the resumption of other potential trade liberalisation opportunities."

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