June 27, 2000

                    House votes against
                    Xinhua

                    By Rowan Scarborough and Stephen Dinan
                    THE WASHINGTON TIMES


                         The House voted overwhelmingly last night to tell
                    the State Department to block China's state-run
                    news agency from occupying an apartment building it
                    bought that overlooks the Pentagon.

                         The measure, an amendment to State's fiscal
                    2001 appropriations, passed 367-34. Only
                    Democrats voted against the amendment.

                         The amendment prevents the department from
                    spending any funds to approve the office move by
                    the Xinhua News Agency.

                         Rep. David Vitter, Louisiana Republican, said the
                    amendment he sponsored "sends a very strong and
                    telling message to the State Department that they
                    must block" the transaction.

                         While the measure would not take effect until the
                    new fiscal year begins Oct. 1 � by which time the
                    State Department likely would have either approved
                    or disapproved the sale � the House wanted to be
                    on record in opposition.

                         Defense analysts say Xinhua often acts as an
                    intelligence-gathering arm of the Chinese government
                    and the building could provide the opportunity to
                    covertly monitor Pentagon comings and goings.

                         The Washington Times reported last week that
                    the Xinhua News Agency had bought the 32-unit
                    apartment building at 1515 S. Arlington Ridge Road.
                    Upper apartments have a direct view of the Pentagon
                    "E-ring," the corridor where senior Defense
                    Department officials, including Defense Secretary
                    William S. Cohen, have their offices.

                         Mr. Vitter called the Xinhua location "an ideally
                    suited spy tower, ideal to capture our military
                    secrets."

                         Rep. Harold Rogers, Kentucky Republican and
                    chairman of a House Appropriations subcommittee,
                    said that he has been in contact with the State
                    Department since The Washington Times reported
                    Xinhua's purchase last week.

                         "It's my expectation they will not approve the
                    sale," he said.

                         Xinhua made the $4.6 million purchase June 15
                    and plans to use the seven-story building as its living
                    and work headquarters in Washington. But the State
                    Department has the power to force China to sell the
                    building.

                         The service bought the apartment building from a
                    U.S. real estate investor. The same complex had
                    been owned by the communist East German
                    government in the 1970s and 1980s.

                         The State Department treats the news agency as
                    an extension of the Chinese Embassy and, under the
                    1985 Foreign Missions Act, Xinhua was required to
                    apply to the department to buy land in the United
                    States. But department officials said last week that,
                    contrary to Chinese statements, it has received no
                    request from China for Xinhua to buy the apartment
                    building.

                         Xinhua, in a dispatch from Beijing over the
                    weekend, again asserted that it requested State's
                    approval May 22. The State Department yesterday
                    reiterated that it received no such petition.

                         "We did not receive any such notification. I don't
                    know if there is some problem with the mail,"
                    spokesman Philip Reeker said in an interview. "I
                    expect them to show up with a copy of the letter.
                    They haven't yet."

                         Under the law, State has 60 days to study a
                    request. Since China is a communist country, the law
                    also subjects Xinhua's purchase to a security review
                    by the Defense Department and the FBI, which
                    conducts domestic counterintelligence. The
                    department said last week it is starting a security
                    review of the location of the Pentagon Ridge
                    Apartments across Interstate 395 from the Pentagon.

                         Zhang Yuanyuan, a spokesman at the Chinese
                    Embassy in Washington said last week, "We don't
                    need the permission."

                         "Xinhua is a company. As long as they go through
                    the legally required procedures, the law does not
                    require them to go through a different procedure. We
                    have been following the laws and regulations of the
                    U.S. in Virginia all along. If something is wrong, the
                    lawyers should know that."

                         A department official said yesterday they have
                    contacted several Chinese government agencies and
                    the news agency itself, but haven't made any decision
                    how to pursue the matter.

                         The news agency's bureau chief did not return
                    phone calls yesterday but last week insisted to The
                    Times that Xinhua isn't an intelligence arm of the
                    Chinese government.

                         Established in 1931, Xinhua serves as an agency
                    of the Chinese government. On politically sensitive
                    matters, Xinhua dispatches are disseminated to
                    state-owned papers in China, which must use the
                    Xinhua version and are not allowed to do their own
                    reporting. In some places, such as Hong Kong,
                    Xinhua serves as a de facto representative office of
                    the Chinese government. The agency has 34
                    domestic bureaus and 104 overseas bureaus.



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