Thread: Republicans offer China bill to help CAFTA odds

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Republicans offer China bill to help CAFTA odds
Thu Jul 14, 2005 7:42 PM ET


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By Doug Palmer

WASHINGTON (Reuters) - Republican lawmakers unveiled legislation on Thursday aimed at addressing China trade concerns that have complicated passage of a controversial free trade agreement with Central America.

The bill, for the first time, would allow U.S. companies to seek duties against "subsidized" imports from China. That is a priority for many U.S. manufacturers who say they are being driven out of business by unfair Chinese trade practices.

The Bush administration has been cool to the idea because of the difficulty of determining subsidies in non-market economies like China. U.S. firms can already seek duties on "dumped" Chinese goods sold below fair-market value.

A U.S. trade official, speaking on the condition she not be identified, said the Bush administration had some concerns about the legislation and was still studying it.

The bill also would require the Treasury Department to fine-tune its definition of currency manipulation, essentially making it more difficult for the Bush administration to avoid labeling China's currency policy as an example of that.

Treasury angered many lawmakers in May when it stopped short of formally calling China a currency manipulator. Taking that step would open the door to retaliatory action, within the bounds of international trade rules, if negotiations to change China's currency policy were unsuccessful.

House Ways and Means Committee Chairman Bill Thomas, a California Republican, called the bill a "strong and responsible" measure that would address concerns about China without violating World Trade Organization (WTO) rules. He predicted the House would approve the measure this month and the administration would accept it, despite its qualms.

Rep. Phil English, a Pennsylvania Republican, said the bill satisfactorily addressed concerns about "the biggest trade issue that America is facing" and that he was now able to support the U.S.-Central American Free Trade Agreement, or CAFTA, which faces a fierce fight in the House this month.

The U.S. trade deficit with China could surpass $200 billion this year after hitting a record $162 billion in 2004. The overall U.S. trade gap is also on track to surpass last year's record of $618 billion.

CAFTA SUPPORT EYED

Fears in Congress about China and the overall trade imbalance have added to the administration's difficulty in winning approval of CAFTA, which would tear down trade barriers between the United States, Costa Rica, Honduras, Guatemala, El Salvador, Nicaragua and the Dominican Republic.

"I would expect at least five or six people currently opposed to CAFTA would rethink their position and come across" as a result of the China bill, English said.

But Rep. Sherrod Brown, an Ohio Democrat, called the China bill "a largely toothless measure (that) will do nothing to fix the failures of CAFTA." An alternative bill offered on Thursday by House Democratic leaders is a more "comprehensive solution to our problems with Communist China," he said.

Republicans remain short of the 218 votes needed for approval in the House. The Senate approved CAFTA last month 54-45.

The Thomas-English bill would require monthly progress reports on commitments China made this week to address U.S. concerns about piracy and counterfeiting that cost American companies billions of dollars in lost sales every year.

It orders the White House to report twice a year on whether Beijing is complying with WTO rules and authorizes $6 million more annually for U.S. trade enforcement actions.

The bill also puts Congress on record that world trade negotiations should preserve the ability of the United States to use its trade laws against unfairly-priced imports.

Hey!! I got a better idea....

PASS THE CHINA BILL

DEFEAT CAFTA



Why negotiate Congress for one of the other, when the AMERICAN PEOPLE need both actions? China brought in line where it belongs and CAFTA thrown in the trash where it belongs!!