White House Toughens Stance on China Trade

Too Little too late?
Or
better than Nothing?


By MARTIN CRUTSINGER
AP Economics Writer

WASHINGTON (AP) -- The Bush administration on Tuesday announced it will step up enforcement of U.S. trade laws governing China, following a top-to-bottom review of America's trading relationship with the Asian giant.

The increased enforcement will be led by a new chief counsel for China trade enforcement within the office of U.S. Trade Representative Rob Portman.

Portman announced a number of steps during a news conference in which he released a 29-page report detailing the findings of a six-month review of America's economic relationship with China.

"The time has come to readjust our trade policy with respect to China," Portman said. "As a mature trading partner, China should be held accountable for its actions and required to live up to its responsibilities, including opening markets and enforcing intellectual property rights."

Portman vowed to "use all options available" to meet this goal.

However, critics said the administration's failure to aggressively prosecute China's unfair trading practices contributed to last year's record $725.8 billion trade deficit. They faulted the administration for not immediately announcing new cases against China before the World Trade Organization.

Portman told reporters during a news conference that the administration will not hesitate to file new cases against Beijing if negotiations fail to resolve various pending disputes.

Sen. Charles Schumer, D-N.Y., faulted the administration's report for failing to deal with what many manufacturing companies see as a major contributor to the trade gap - Chinese policies that keep China's currency undervalued against the U.S. dollar, giving the country huge trade advantages against U.S. producers.

"It is amazing that in a comprehensive 29-page report, the trade representative fails to mention the 800 pound gorilla in the room - how China manipulates its currency," Schumer said in a statement.

The administration's announcement Tuesday followed news last Friday that America's trade deficit with China rose to $201.6 billion, the largest deficit the United States has ever incurred with a single country.

This soaring trade deficit has increased pressure on the administration from lawmakers who want to see a tough crackdown on what they believe are unfair trading practices by China, such as manipulating its currency and copyright piracy.