U.S.-CHINA TRADE PACT UNVEILED

Byline: Joanna Ramey

WASHINGTON — The Clinton administration on Tuesday made public the U.S.-China trade pact negotiated last fall as part of China’s bid to join the World Trade Organization, a disclosure intended to counter critics of the agreement and help secure support for it in Congress.
The White House had been reluctant to divulge the 250-page text until China completes negotiations with other WTO members, fearing a Chinese backlash. However, there has been increased pressure from Congress, whose members have had access to the agreement, to make it public.
The secrecy — only summaries of the U.S.-China deal were previously made available — served to fuel critics of China joining the WTO and criticism of the global trade body being isolated from public examination.
The U.S.-China agreement is a crucial part of China’s application to join the WTO. The deal opens China’s markets to a wide range of U.S. goods and services, including the easing of barriers to foreign retailers opening stores and creating national distribution channels.
“We are confident that once people have reviewed the agreement, they will see for themselves that this is a tremendous deal for American workers, farmers and businesses,” U.S. Trade Representative Charlene Barshefsky said in a statement, calling the pact important to sustaining U.S. economic growth.
The agreement is filled with product-by-product details of how Chinese tariffs would be whittled down through 2008. For example, tariffs on women’s fine wool suits would drop to 17.5 percent from 32.9 percent and duties on women’s cotton blouses would drop to 16 percent from 27.2 percent.
Congress in coming months is expected to vote on whether to grant China permanent normal trade-relations status. PNTR status guarantees Chinese goods the same favorable U.S. tariffs enjoyed by almost all other nations. Congress has voted annually to renew China’s trading status.
If Congress rejects PNTR, Chinese officials said this week they would respond by not allowing the U.S. to avail itself of lower Chinese tariffs and other market access provisions negotiated last fall because they would view the U.S. as discriminating against China. However, China would still grant market access to other WTO members who won’t place such restrictions.
These comments from Chinese officials issued in Beijing have served to heighten pressure on the White House to lobby Congress on PNTR, along with a huge U.S. business lobby spending millions to promote the U.S.-China deal.
Lobbying efforts are largely focused in the House, where President Clinton will have to rely on votes from the Republican majority, while arm-twisting members from his own party, to insure PNTR’s passage.
Minority Whip David Bonior (D., Mich.), a fierce anti-China-WTO voice, has said 128 of the chamber’s 211 Democrats will oppose PNTR, leaving 83 Democrats who are either committed to PNTR or undecided.
Pro-China-PNTR House Speaker Dennis Hastert (R., Ill.) is hoping for a heavier Democratic turnout, figuring at at least 100 Democrat votes will be needed for PNTR to pass.
Jonathan Gold, legislative representative for the International Mass Retail Association, said issuing the actual agreement can only help in furthering the PNTR debate.
“There are a lot of misconceptions out there about the agreement,” Gold said. “Now, the public can see the U.S. really isn’t giving up anything to the Chinese, but we gain a lot.”
A criticism of the deal is that U.S. quotas on Chinese textiles would phase out by 2005, along with other WTO members. The U.S. textile industry would have liked quotas dropped in 2010 in order to prepare for the increased competition.
Gold said the textile and apparel industries will be served by the U.S.-China deal by import surge protections.
However, Ann Hoffman, legislative director for the apparel union UNITE, said release of the agreement will serve “to revitalize discussion” of granting China PNTR. Particularly, she said the pact’s details should bear out the argument that “it is an investment agreement” designed for U.S. companies to take advantage of cheap Chinese labor and create an export platform targeting the U.S., including the apparel industry.
Hoffman balks at the argument that China and its 1.3 billion population is a potential audience for U.S. exports.
“They earn 13 cents an hour, so we won’t have a lot of customers,” she said.

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