U.S. To Press Trade Issues With China

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The U.S. trade office pledged yesterday to use “all options available” to get China to drop all barriers to American exports, as the Bush administration tries to lower the record trade deficit and stem criticism from Congress.


China must open its market to more imports, crack down on the piracy of copyrighted movies, and software and curb subsidies to exporters in order to cut its trade surplus, the U.S. trade office said in its review of policy toward China.


To prod China along, at least a dozen new people will be hired in Washington and Beijing, with one new office focused entirely on getting China to live up to its commitments in the World Trade Organization, the report said. It’s the first time America has singled out one country for such scrutiny.


“Our bilateral trade relationship with China today lacks equity, durability, and balance,” U.S. Trade Representative Rob Portman said at a news briefing in Washington announcing the findings of the 10-month study. Mr. Portman called last year’s $202 billion trade deficit with China politically unsustainable.


The Bush administration is trying to head off legislation in Congress to impose punitive tariffs or import quotas on Chinese goods, proposals the administration says would undermine the benefits of commercial engagement with China. At the same time, the administration’s report lays out specific changes the Chinese should take to allow more American exports and narrow the trade gap.


The administration “is trying to articulate to Congress and the business community what it views as the totality of our interests with the Chinese,” the vice president for Asia at the U.S. Chamber of Commerce, Myron Brilliant, said.


And it is saying, “Our patience isn’t going to last forever,” he said.


Democrats in Congress, labor unions, and some manufacturers have blamed the widening trade gap on China’s practice of subsidizing domestic companies and holding down the value of its currency. And they have criticized the Bush administration for not doing enough to curb China’s use of these trade practices.


The deficit with China last year accounted for more than a quarter of the overall U.S. trade gap. Mr. Portman is scheduled to testify before the House Ways and Means Committee tomorrow, where he is likely to face questions on breaking down export barriers.


“I have to ask: Where’s the beef?” Benjamin Cardin, the top Democrat on the trade subcommittee of the House Ways and Means Committee, said. “The administration promises no new enforcement of trade laws, no new action in the WTO, and no further steps to combat China’s unfair practices.”


The report says much of the focus will involve fair market access for telecommunications, financial services, health care, and direct-sales companies; subsidies; labor law; and regulatory transparency.


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