US senators to unveil China trade bill Tuesday
Washington, Mar 25: The top Republican and Democrat on the Senate Finance Committee plan to introduce long-awaited China trade legislation on Tuesday, a move that could siphon support from a controversial bill threatening China with tariffs.
Senate Finance Committee Charles Grassley, an Iowa Republican, and Sen. Max Baucus, a Montana Democrat, said in a press release on Friday they would unveil their bill on Tuesday. That is just a few days before the Senate is scheduled to vote on a bill threatening to punish China for its currency policies.
Many U.S. lawmakers and manufacturers believe China deliberately undervalues its yuan by 15 to 40 per cent, which they say gives Chinese companies a big advantage over their American competitors.
The United States has been pressing China for action on the issues and would like to see the yuan rise further against the dollar before a White House meeting between U.S. President George W. Bush and Chinese President Hu Jintao on April 20.
The Grassley-Baucus ''legislation will establish a more constructive framework to address currency imbalances that harm the U.S. economy,'' the senators' statement said. ''The bill will also address congressional concerns regarding trade enforcement, by focusing efforts to prioritize and respond to the most significant export barriers.'' The legislation is aimed at facilitating ''a more positive engagement with our trading partners, including China, by encouraging compliance with the norms expected of economies that derive benefit from an open international trading system,'' the senators' statement said.
The United States wants China, which has benefited greatly from export-led growth in recent decades, to open its markets to more foreign goods and to stamp out piracy and counterfeiting that cost American companies billions of dollars in lost sales every year.
In a sign of frustration over the huge U.S. trade deficit with China, which hit a record 2 billion last year, the Senate is scheduled to vote next Friday on a bill threatening China with a 27.5 per cent tariff on its exports to the United States if Beijing does not revalue its yuan currency at a ''fair market'' value against the U.S. dollar.
The authors of that legislation, Sen. Charles Schumer, a New York Democrat, and Sen. Lindsey Graham, a South Carolina Republican, indicated after meetings with senior Chinese officials this week in Beijing that they could decide to delay a vote on their bill.
Schumer and Graham said they would make a final decision after consulting next week with U.S. Treasury Secretary John Snow and Senate colleagues. Last year, the Graham-Schumer bill survived an effort to kill it on the Senate floor by a vote of 67-33, sending the Bush administration a wakeup call about the level of anger in Congress about trade relations with China.