Although US Secretary of the Treasury Henry M. Paulson, Jr. touted the success of last week's US/China Strategic Economic Dialogue (SED), textile and other manufacturers were less than excited about it. At the conclusion of the talks at the US Naval Academy in Annapolis, Md., Paulson said, " I am pleased that we continue to build stronger relationships between our leaders and our countries and that this innovative effort to strengthen a unique economic relationship is a success."
Paulson cited success in dealing with two specific initiatives - energy and environmental cooperation. He pointed out that China and the United States are the two largest net importers of oil, account for more than half of the world's coal consumption and are the two largest emitters of greenhouse gases. He announced that the two countries will sign a 10-year Energy and Environmental Cooperation Framework. Paulson also said the two nations have agreed to launch negotiations on a bilateral investment treaty that he said could lead to treating each other's investors in a "fair and transparent manner."
Textile and other industry representatives in Washington expressed their disappointment that the talks did not focus on international trade issues, and particularly, what they see as China's manipulation of its currency in order to gain advantages in international trade. The Alliance for American Manufacturing (AAM), a partnership of labor and industry representatives, said the talks " squandered an opportunity to make China trade more balanced and market driven." AAM's Executive Director Scott Paul said the SED is built on a "flawed premise" that periodic discussions alone can achieve progress on critical issues. He called for a "more robust" approach from Washington that includes specific objectives, a mechanism for assessing progress, and incentives for making progress and punitive measures for backsliding.
Prior to the opening of the talks, a bipartisan group of 11 senators sent a letter to Secretary Paulson urging him to "push the Chinese government to stop manipulating its currency and allow great appreciation of its renminbi (RMB)."
In part, the letter said: "The lack of significant progress on the continuously misaligned RMB has substantial negative effects on American manufacturers. China's long-standing policy of undervaluing its currency -in violation of the International Monetary Fund commitments - effectively gives an unfair competitive advantage of up to 40 percent to its frequently state-run firms. The unfair price advantage that the under-valued RMB gives Chinese firms has forced many American companies to declare bankruptcy or even to go out of business, harming our workers, families and middle class."
The senators said they believe US manufacturers can compete in a world economy, but that they cannot compete when their competitors are supported by government policies that deliberately make their exports artificially cheaper. The letter was signed by Democratic Sens. Barack Obama, Ill.; Sherrod Brown, Ohio; Sander Levin, Mich.; Evan Bayh, Ind.; Debbie Stabenow, Mich.; Charles Schumer, N.Y.; and Sheldon Whitehouse, R.I.; and Republican Sens. Elizabeth Dole, N.C.; Jim Bunning, Ky.; Olympia Snow, Maine; and Kent Conrad, Mont.
Secretary Paulson said China has been making some progress toward increasing the pace of its currency appreciation, but he urged the Chinese to continue its move toward currency flexibility.
Paulson cited success in dealing with two specific initiatives - energy and environmental cooperation. He pointed out that China and the United States are the two largest net importers of oil, account for more than half of the world's coal consumption and are the two largest emitters of greenhouse gases. He announced that the two countries will sign a 10-year Energy and Environmental Cooperation Framework. Paulson also said the two nations have agreed to launch negotiations on a bilateral investment treaty that he said could lead to treating each other's investors in a "fair and transparent manner."
Textile and other industry representatives in Washington expressed their disappointment that the talks did not focus on international trade issues, and particularly, what they see as China's manipulation of its currency in order to gain advantages in international trade. The Alliance for American Manufacturing (AAM), a partnership of labor and industry representatives, said the talks " squandered an opportunity to make China trade more balanced and market driven." AAM's Executive Director Scott Paul said the SED is built on a "flawed premise" that periodic discussions alone can achieve progress on critical issues. He called for a "more robust" approach from Washington that includes specific objectives, a mechanism for assessing progress, and incentives for making progress and punitive measures for backsliding.
Prior to the opening of the talks, a bipartisan group of 11 senators sent a letter to Secretary Paulson urging him to "push the Chinese government to stop manipulating its currency and allow great appreciation of its renminbi (RMB)."
In part, the letter said: "The lack of significant progress on the continuously misaligned RMB has substantial negative effects on American manufacturers. China's long-standing policy of undervaluing its currency -in violation of the International Monetary Fund commitments - effectively gives an unfair competitive advantage of up to 40 percent to its frequently state-run firms. The unfair price advantage that the under-valued RMB gives Chinese firms has forced many American companies to declare bankruptcy or even to go out of business, harming our workers, families and middle class."
The senators said they believe US manufacturers can compete in a world economy, but that they cannot compete when their competitors are supported by government policies that deliberately make their exports artificially cheaper. The letter was signed by Democratic Sens. Barack Obama, Ill.; Sherrod Brown, Ohio; Sander Levin, Mich.; Evan Bayh, Ind.; Debbie Stabenow, Mich.; Charles Schumer, N.Y.; and Sheldon Whitehouse, R.I.; and Republican Sens. Elizabeth Dole, N.C.; Jim Bunning, Ky.; Olympia Snow, Maine; and Kent Conrad, Mont.
Secretary Paulson said China has been making some progress toward increasing the pace of its currency appreciation, but he urged the Chinese to continue its move toward currency flexibility.
