On the eve of two days of high-level economic and trade discussions between the United States and China, the American Manufacturing Trade Action Coalition (AMTAC) issued a statement citing what it called “China’s predatory trade practices,” and urged the two governments to address problems resulting from a major US trade deficit with China.
The comments came as the two countries were preparing to engage in the second in a series of semi-annual “Strategic Economic Dialogues” May 22-23 in Washington. The US delegation, headed by Treasury Secretary Henry M. Paulson Jr., will include the secretaries of Commerce, Labor, State, Transportation, Health and Human Services, and Agriculture; the Environmental Protection Administrator; and the US Trade Representative.
Paulson said the meeting will review progress on work the governments agreed to in their first economic dialogue last December. He said discussions will address “economic imbalances,” measures to ensure continued global growth, China’s economic development and further integration into the world trading system and greater openness to markets.
At the conclusion of the December meetings, Paulson said: “We have agreement with the Chinese government on a number of fundamental principles. We agreed on the need for balanced, sustainable growth in China without large trade imbalances, which will aid China’s successful integration into the global economy.” He said “important pieces of the equation” include exchange rate flexibility, protection of intellectual property rights, increasing the role of consumption in the economy and opening the service sector to competition and investment. He added that China’s currency policy is a “core issue in our economic relationships.”
The AMTAC statement picked up on the currency issue and also cited tax rebates for exporters, loans made to industries at subsidized rates and theft of intellectual property as being among the “predatory practices.”
“America’s foreign trade relationship with China is mostly a one-way street,” said AMTAC Executive Secretary Auggie Tantillo. “China gains the lion’s share of the benefits while US manufacturing and the workers pay the price in lost jobs and market share.”
AMTAC’s analysis of the China trade issue cited a $232 billion US trade deficit with China in 2006, and said China is responsible for 47 percent of the $528 billion total US trade deficit in manufactured goods.
By James A. Morrissey, Washington Correspondent
