A Balanced Common Sense Approach to Trading with China-a Level Playing Field

A Balanced Common Sense Approach to Trading with China-a Level Playing Field

I am among a group of House Members who are concerned with America's manufacturing and farming sectors and who believe China is not competing on a fair and level playing field. Because of these concerns, I am a co-sponsor of legislation to provide sanctions against China, and I have sent letters with other Members of Congress to administration officials calling on them to take appropriate actions to address China's violations of existing trade agreements. These efforts are important to protect America's manufacturers and farmers.

China represents one of the United States greatest, and yet most challenging, trade opportunities. Nearly 20% of the Earth's population lives in China, representing a tremendous market for American farmers, innovators, salespeople, and services. However, to realize the potential envisioned in 1999, when the United States agreed to a bilateral agreement on China's accession to the World Trade Organization (WTO), the Chinese government must comply with its 2001 WTO agreements as well as its International Monetary Fund (IMF) and General Agreements on Tariffs and Trade (GATT) commitments.

China must stop their illegal and unfair currency manipulation practices, which are taking manufacturing jobs away from Americans. I am a co-sponsor of Representative Phil English's (R-PA) bill requiring the Secretary of the Treasury to analyze and report on the exchange rate policies of China and to require additional tariffs be imposed on Chinese products based on the rate of manipulation of their currency.

Since 1993, the Chinese currency (renminbi or yuan) has been pegged to the U.S. dollar at a rate of 8.28. The Chinese Central Bank requires all foreign currency turned over at this rate. This makes Chinese exports cost an estimated 40% less in the U.S. than if the yuan were allowed to trade freely. This illegal currency manipulation creates a significant competitive disadvantage for U.S. export industries and is a primary factor in the over $125M trade deficit the United States had with China last year. Ultimately, these factors cost the United States economy manufacturing jobs.

I have also signed, with several other House Members, a letter to United States Trade Representative, Ambassador Robert Zoellick, encouraging him to file a complaint against China with the WTO for their most egregious trade practices, including the unfair currency issue.

China holds great opportunity for the Third District's farmers, but China's non-tariff barriers, such as artificial sanitation standards, have blocked free and fair agricultural imports. Soy-bean growers, in particular, have been hurt by China's protectionist attempts to support Chinese farmers at the start of their domestic soy-bean harvest by blocking the import of high-quality, less-expensive U.S. soy beans. This is just one agricultural example of China's failure to allow free and fair trade.

Administration officials have taken additional steps, suggesting they may be ready to work with Congress to get the Chinese government to comply with international trade laws. Commerce Secretary Don Evans warned U.S. patience is waning by saying, "The American market will not remain open to Chinese exports indefinitely, if the Chinese market is not equally opened to U.S. companies and American workers."

My recent Congressional efforts strongly stress that the Chinese government must play by the rules of fair trade as established by the WTO, IMF and GATT. The time has come for the United States government to seek remedies to protect American farmers and manufacturers