AMI Urges Congress to Oppose Currency Reform and Fair Trade ActTuesday, September 28, 2010
(American Meat Institute)
AMI, joined by a number of industry associations, is urging House leadership to oppose H.R. 2378, the Currency Reform for Fair Trade Act, which seeks to address the value of China’s currency.
“Like Congress and the Administration, we agree that China needs a yuan exchange rate that responds to trade flows and that China should move rapidly towards a market-determined exchange rate. … We do not agree, however, that H.R. 2378 as reported by the Committee on Ways and Means can help achieve that goal,” stated the organizations in a letter to House Speaker Nancy Pelosi (D-CA), House Majority Leader Steny Hoyer (D-MD) and House Minority Leader John Boehner (R-OH).
“Passage of this legislation is counterproductive not only to the goals related to China’s exchange rate that we all share, but to our nation’s broader goals of addressing the many and growing challenges in the U.S.-China economic relationship, including inadequate protection of intellectual property to restrictions on market access, financial services liberalization, export of commodities such as rare earths, discriminatory indigenous innovation and other industrial policies. Above all this legislation will do more harm than good to job creation and economic growth at a time when we need both dearly,” the letter continues.
The letter notes that unilateral legislation, which seeks to increase tariffs on imports from China, is unlikely to incentivize China to move expeditiously to modify its exchange policies. Rather, it would likely have the opposite effect and could engender retaliation against U.S. exports into the Chinese market, currently the fastest-growing market for U.S. exports.
In addition, since application of countervailing duties (CVDs) to imports from China on the basis of this legislation is of questionable World Trade Organization (WTO) legality, China would almost certainly challenge this action as violative of U.S. WTO obligations, which would focus the world’s attention on the United States and WTO technicalities, and away from China’s exchange-rate policies.
“We share Congress’ desire to have China act more quickly to adopt a market- determined exchange rate. But the proposed unilateral measure is not going to achieve that result. We urge you to oppose H.R. 2378 and instead work with and vigorously call on the Administration to develop a robust bilateral and multilateral approach to achieve tangible results not only on China’s exchange-rate policies, but also on other Chinese policies that are harming American businesses, workers and farmers,” the letter concludes.
To view the letter in its entirety, click
here: The link to this document is:
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