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Congress Greets China Ultimatum With Applause For Get-Tough Stance

Byline: </CS>JOYCE BARRETT<BR><BR>WASHINGTON -- The administration's ultimatum Thursday against China's trade violations got a good reception from members of Congress close to the trade debate. At least one senator said if China does not take steps to...

Byline: JOYCE BARRETT

WASHINGTON — The administration’s ultimatum Thursday against China’s trade violations got a good reception from members of Congress close to the trade debate. At least one senator said if China does not take steps to end its illicit actions, he will move to make the administration’s policy law.

Rep. John Spratt (D., S.C.) praised the promised quota reduction outlined by U.S. Trade Representative Mickey Kantor.

“I applaud Ambassador Kantor for facing down the Chinese and telling them squarely that if they want to sell textiles, clothing or any other products to the U.S., they must play by the rules,” said Spratt. “No country enjoys more access to our textile and clothing market than China. Despite the generous quotas, which China has accepted, China overships its quotas every year.”

Spratt is chairman of the House Textile Caucus and has probed China’s transshipping practices in hearings held by the Government Operations Commerce, Consumer and Monetary Affairs Subcommittee, which he chairs.

Spratt said he planned to pursue additional policies to end transshipments, and he said he would seek tougher bilateral treaties with textile-exporting countries and greater resources for the Customs Service to detect and detain the illegal shipments.

Rep. L.F. Payne (D., Va.), another member of the House Textile Caucus and an advocate for the domestic textile industry on the House Ways and Means Committee — which has jurisdiction over tax and trade matters — lauded the action as a signal to China and all other trading partners that “the U.S. expects them to trade fairly.”

Sen. Max Baucus (D., Mont.), chairman of the Senate Trade Subcommittee, also applauded the administration’s move.

“Obviously they needed a tougher approach,” Baucus said in a statement. “The administration has shown China that it will enforce a tough trade policy.”

Sen. Ernest Hollings (D., S.C.), who has opposed granting China trade benefits with the U.S. in the past, approved of the administration’s action, yet said in a statement, “Let’s not jump up and down for the fact that we’re finally enforcing our agreements.”

Hollings also said he has evidence that the Chinese will move their yarn production to Mexico under the North American Free Trade Agreement, and added, “So all we’re doing may be for naught. But the message is still clear that the U.S. will not sit idly by while outlaw governments ignore international agreements.”

Following news of the administration’s action, Hollings mobilized his staff to put the final touches on a bill that would make the administration’s proposal of cutting China’s textile quota law.

That bill could be introduced by the end of January when Congress reconvenes. A Hollings staffer said that since it is a reiteration of the administration’s proposal, “how can they be against it?”

The measure, which Hollings drafted along with House Textile Caucus Chairman Spratt, also would increase criminal penalties against retailers and importers who accept transshipped goods.

The administration’s action opens the congressional debate this year on whether to extend China’s Most Favored Nation trade status. Payne, who voted to grant China MFN last year, said that without positive action by the Chinese before Jan. 17, he would likely oppose it this year.

“It will be hard for us working on trade issues to feel good about the Chinese gaining MFN status if they are not willing to sit down and work on a mutually agreeable solution,” Payne said in a telephone interview. The 40-member House Textile Caucus has yet to take a stance on China MFN this year, he said, and added it will closely watch China’s reaction.

A campaign being waged by retailers and importers to convince members of Congress of the importance of trade with China appears to be taking root. Despite his misgivings about extending China’s benefits, Payne said, “We all realize it is very important for the U.S. and China to develop a good, sound trading relationship. We have two of the largest economies in the world, and we need to work together in each of our interests. Everyone in Congress is aware of that, and we want to work toward a policy so we could be trading partners with one another in a way that is mutually beneficial.”