Byline: Joanna Ramey

WASHINGTON — A Senate vote on granting permanent normal trade relations to China may finally come in the next two weeks as Republicans and Democrats appear closer to removing roadblocks that have delayed action.
Almost two months ago, passage in the Senate of PNTR seemed a certainty, after being approved in the House by a 237-197 vote after a contentious debate and intense lobbing efforts by various business and special interest groups.
Senate action on the bill — a key step in China’s bid to join the World Trade Organization, a priority of U.S. business — has been held up by a parliamentary threat unrelated to PNTR.
Watching the bill languish — in spite of its widespread support among Senate Republicans and Democrats — is making backers nervous. There are just two weeks left before Congress adjourns for its August recess. Lawmakers are scheduled to return in September, but will then adjourn at the end of that month for the remainder of the year for electioneering.
“We are concerned about the delay,” said Erik Autor, vice president and international trade counsel at the National Retail Federation. “As we approach the [presidential nominating] conventions and+ if we pass the conventions without a vote, the risk that electoral politics will muck things up runs very high.”
Retailers, along with apparel and textile importers, are part of a broad business coalition supporting China’s WTO membership. Congress needs to PNTR in order for U.S. companies to qualify for lower Chinese tariffs and other market-access provisions negotiated as part of China’s WTO-entry pact with the U.S.
Under the WTO agreement, retailers could operate private national distribution networks in China. Textile and apparel quotas from China would also phase out in sync with other WTO members on Jan. 1, 2005, according to the agreement. As a result of PNTR, importers would enjoy the certainty of unfettered shipments from China because annual renewal of Chinese trade status, which grants favorable U.S. tariffs, would be eliminated.
The PNTR holdup in the Senate rests with a bill, sponsored by Sen. Fred Thompson (R., Tenn.) that would levy sanctions against China if it sells nuclear weapons to so-called “rogue nations” like Pakistan.
The senator has threatened to block PNTR if his bill isn’t considered first, or added to the PNTR legislation. His parliamentary threat puts Republican leadership in the awkward position of having to appease a party member before bringing PNTR, a legislative priority, to a vote.
Meanwhile, Sen. Max Baucus (D., Mont.), has threatened to block the Thompson measure until a date for the PNTR vote has been set.
Wednesday evening, Republican and Democrat Senate leaders, as well as White House officials, met to try and resolve differences over the Thompson bill. Concerns over the Thompson measure include whether it would again upset Chinese-U.S. relations, rebuilt after the mistaken U.S. bombing last year of the Chinese embassy in Belgrade.
Senate Minority Leader Tom Daschle (D., S.D.) said Thursday that negotiations over the Thompson bill appear promising. Senate Trade Subcommittee chairman Charles Grassley (R., Iowa) told reporters after the Wednesday meeting that there is a commitment to have a vote in July.
Jonathan Gold, director of international trade policy at the International Mass Retail Association, said he’s starting to worry about PNTR’s fate, particularly in light of all the pressure the business lobby is putting on Lott to move the bill.
Gold said he feared that, “If we wait any longer, as we get close to the elections, some members could change their votes.”
Meanwhile, absent Senate action on PNTR, the House on Thursday began gearing up for its annual renewal vote on China’s normal trade relation status, starting with consideration in the House Ways and Means Committee. The annual vote has always resulted in Congress renewing China’s status, but debate has consistently raised questions as to whether the U.S. should reward China in light of its poor record on human and worker rights and the environment.
For opponents of China being granted any form of normal trade relations, delay in Senate consideration is of little consolation, said Ann Hoffman, legislative director of UNITE. Opposition to China receiving PNTR rests on its poor human rights, worker rights, and trade agreement compliance records.
The PNTR logjam in the Senate “is the only remaining hope, and I don’t know that I would pin a whole lot of hope on it, but one never knows,” Hoffman said. “When you look at this session, I would say unpredictability is the watchword.”

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