Two US senators proposed legislation on Thursday that would repeal permanent normal trade relations (PNTR) status for China, citing Beijing's alleged unfair trade practices and a rocketing US trade deficit.
The US Congress granted China the PNTR status in 2000, which paved the way for the most populous nation to enter the WTO and for US businesses to deal more seamlessly with Beijing.
But senators Byron Dorgan and Lindsey Graham, co-authors of the bipartisan measure, said the status should be rescinded in retaliation for China's unfair trade practices which they said were responsible for the huge US trade deficit, which could surpass US$200 billion for last year.
They cited practices including piracy, currency manipulation, violation of its own labor laws, and barriers to prevent US products from entering the Chinese market.
"There's nothing normal or fair about any of these methods," Dorgan, the Democratic senator from North Dakota, told a joint news conference with Graham, a South Carolina legislator from US President George W. Bush's Republican Party.
"I think we have reached the tipping point on the issue of China. It cheats in a way that hurts this country," he said.
Graham acknowledged the legislative action was "drastic in the sense of politics" but added: "I think it's necessary in the sense of business."
The PNTR status, he said, should only be granted to China on an annual basis subject to progress on reforms that are scrutinized by Congress.
The lawmakers did not say when they plan to debate or push for a vote on the bill but the move comes as US President George W. Bush prepares to welcome his Chinese counterpart, Hu Jintao (胡錦濤), in April.
Cautioning the lawmakers, US Trade Representative Rob Portman said any decision to withdraw the PNTR from China could have a boomerang effect.
"To me it would do nothing to help with the trade deficit, in fact the reverse, relative to China," Portman told reporters after talks with the members of the Senate Agriculture Committee.
Graham is behind another similar bipartisan measure that would force China to revalue its currency or face higher tariffs on Chinese imports.
The legislation, to impose a 27.5 percent tariff across the board on Chinese imports, has good support in Congress, lawmakers say.
"There is nothing normal about the way China manages its currency. They manipulate their currency to get an economic advantage over the world, not just the United States, and the world is telling China, `end your manipulation practices and allow your currency to go to its market value,'" Graham said.
After months of intense US pressure, China freed the yuan from an 11-year-old peg to the US dollar in July last year, revaluing it by 2.1 percent and putting it in a trade-weighted basket of currencies. The yuan was also allowed to move 0.3 percent either way on any given day.
But legislators and businesses in the US say the yuan remains undervalued and continues to sink the country's trade balance deeper into the red.
Portman pointed out that China was a vital market for the US.
It is the biggest US export market in terms of growth, averaging around 15 to 20 percent over the last two years, among large economies, he said.
"It's been a great export market for us, and part of that is because they're now in the WTO, we're able to not only seek lower tariffs ... [and] we should not lose sight of the fact that in the export side it's created a lot of jobs in the US," he explained.
Portman admitted that the US "could do better in China if we can get China to live by the rules."
But imports and export alone do not determine the trade deficit, he said, citing other factors like the macroeconomic situation.
NO-LIMITS PARTNERSHIP: ‘The bottom line’ is that if the US were to have a conflict with China or Russia it would likely open up a second front with the other, a US senator said Beijing and Moscow could cooperate in a conflict over Taiwan, the top US intelligence chief told the US Senate this week. “We see China and Russia, for the first time, exercising together in relation to Taiwan and recognizing that this is a place where China definitely wants Russia to be working with them, and we see no reason why they wouldn’t,” US Director of National Intelligence Avril Haines told a US Senate Committee on Armed Services hearing on Thursday. US Senator Mike Rounds asked Haines about such a potential scenario. He also asked US Defense Intelligence Agency Director Lieutenant General Jeffrey Kruse
NOVEL METHODS: The PLA has adopted new approaches and recently conducted three combat readiness drills at night which included aircraft and ships, an official said Taiwan is monitoring China’s People’s Liberation Army (PLA) exercises for changes in their size or pattern as the nation prepares for president-elect William Lai’s (賴清德) inauguration on May 20, National Security Bureau (NSB) Director-General Tsai Ming-yen (蔡明彥) said yesterday. Tsai made the comment at a meeting of the Legislative Yuan’s Foreign Affairs and National Defense Committee, in response to Democratic Progressive Party (DPP) Legislator Wang Ting-yu’s (王定宇) questions. China continues to employ a carrot-and-stick approach, in which it applies pressure with “gray zone” tactics, while attempting to entice Taiwanese with perks, Tsai said. These actions aim to help Beijing look like it has
China’s intrusive and territorial claims in the Indo-Pacific region are “illegal, coercive, aggressive and deceptive,” new US Indo-Pacific Commander Admiral Samuel Paparo said on Friday, adding that he would continue working with allies and partners to keep the area free and open. Paparo made the remarks at a change-of-command ceremony at Joint Base Pearl Harbor-Hickam in Hawaii, where he took over the command from Admiral John Aquilino. “Our world faces a complex problem set in the troubling actions of the People’s Republic of China [PRC] and its rapid buildup of forces. We must be ready to answer the PRC’s increasingly intrusive and
INSPIRING: Taiwan has been a model in the Asia-Pacific region with its democratic transition, free and fair elections and open society, the vice president-elect said Taiwan can play a leadership role in the Asia-Pacific region, vice president-elect Hsiao Bi-khim (蕭美琴) told a forum in Taipei yesterday, highlighting the nation’s resilience in the face of geopolitical challenges. “Not only can Taiwan help, but Taiwan can lead ... not only can Taiwan play a leadership role, but Taiwan’s leadership is important to the world,” Hsiao told the annual forum hosted by the Center for Asia-Pacific Resilience and Innovation think tank. Hsiao thanked Taiwan’s international friends for their long-term support, citing the example of US President Joe Biden last month signing into law a bill to provide aid to Taiwan,