An example of how trade policy can influence foreign policy occurred in the 1990s when the Clinton administration bestowed "most-favored-nation" status on China in exchange for China's willingness to moderate its human rights policies.

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This statement is true. The granting of most-favored-nation status (now called Permanent Normal Trade Relations) was a key part of the U.S. trade policy towards China at the time, and was seen as an incentive for China to improve its human rights record. This decision also had a significant impact on U.S.-China relations and influenced foreign policy towards China.

An Example of How Trade Policy Can Influence Foreign Policy