China surplus shows US must push on yuan: Schumer
11 Aug 2010, 0330 hrs IST,REUTERS
WASHINGTON: Senator Charles Schumer, an outspoken critic of China's trade policy, on Tuesday seized on an unexpected surge in the East Asian country's trade surplus to renew his call for US legislation to deal with Beijing's currency practices.
"These numbers show just how little motive China has to end its currency manipulation unless it is pushed to do so," Schumer said in a statement after new data showed China's trade surplus widened in July to an 18-month high of $28.7 billion.
Schumer is one of the US Congress' loudest critics of China's currency practices, which he blames for scores of lost US manufacturing jobs. He also leads a bipartisan group pressing for legislation that would require the Commerce Department to apply countervailing duties against countries with undervalued currencies.
The lawmakers contend China's currency is undervalued by 25 percent to 40 percent against the US dollar, giving Chinese exporters an unfair price advantage.
Those complaints could intensify in coming months, with US unemployment remaining near 10 percent and one-third of the Senate and all the House of Representatives up for re-election in November. That includes Schumer.
China loosened its currency, known as the yuan, from a near two-year peg to the dollar on June 19. Since then, the yuan has strengthened just 0.8 percent against the dollar.
"China's expanding trade surplus tells us two things. First, China is back to its same old mercantilist tricks. Second, China's currency announcement was a sham," Scott Paul, executive director of the Alliance for American Manufacturing, said in a statement.
The House Ways and Means Committee has set a hearing on China's currency practice for Sept 15 and is expected to hear testimony from Representative Tim Ryan, who is pushing legislation similar to Schumer's bill.
"We look forward to working with the House and Senate to pass China currency legislation that will put Americans back to work," Paul said.
Other groups such as the US Chamber of Commerce and the US China Business Council have lobbied Congress not to pass legislation on the issue because it could be counterproductive and run afoul of World Trade Organization rules.
Many lawmakers believe the US Commerce Department already has the authority to treat China's undervalued currency as a subsidy under was US trade law.
The Commerce Department has for months been considering whether to launch investigations that could lead to countervailing duties against China's currency in two specific cases involving coated paper and aluminum products.
US Commerce Secretary Gary Locke told Reuters on Tuesday he did not know how much longer it would be before the department decides whether to investigate.
"We need to consult with the lawyers a little bit more, so I'm not exactly sure on the timetable by which we have to make a decision on that," Locke said, after an event touting his department's handling of the 2010 census.
11 Aug 2010, 0330 hrs IST,REUTERS
WASHINGTON: Senator Charles Schumer, an outspoken critic of China's trade policy, on Tuesday seized on an unexpected surge in the East Asian country's trade surplus to renew his call for US legislation to deal with Beijing's currency practices.
"These numbers show just how little motive China has to end its currency manipulation unless it is pushed to do so," Schumer said in a statement after new data showed China's trade surplus widened in July to an 18-month high of $28.7 billion.
Schumer is one of the US Congress' loudest critics of China's currency practices, which he blames for scores of lost US manufacturing jobs. He also leads a bipartisan group pressing for legislation that would require the Commerce Department to apply countervailing duties against countries with undervalued currencies.
The lawmakers contend China's currency is undervalued by 25 percent to 40 percent against the US dollar, giving Chinese exporters an unfair price advantage.
Those complaints could intensify in coming months, with US unemployment remaining near 10 percent and one-third of the Senate and all the House of Representatives up for re-election in November. That includes Schumer.
China loosened its currency, known as the yuan, from a near two-year peg to the dollar on June 19. Since then, the yuan has strengthened just 0.8 percent against the dollar.
"China's expanding trade surplus tells us two things. First, China is back to its same old mercantilist tricks. Second, China's currency announcement was a sham," Scott Paul, executive director of the Alliance for American Manufacturing, said in a statement.
The House Ways and Means Committee has set a hearing on China's currency practice for Sept 15 and is expected to hear testimony from Representative Tim Ryan, who is pushing legislation similar to Schumer's bill.
"We look forward to working with the House and Senate to pass China currency legislation that will put Americans back to work," Paul said.
Other groups such as the US Chamber of Commerce and the US China Business Council have lobbied Congress not to pass legislation on the issue because it could be counterproductive and run afoul of World Trade Organization rules.
Many lawmakers believe the US Commerce Department already has the authority to treat China's undervalued currency as a subsidy under was US trade law.
The Commerce Department has for months been considering whether to launch investigations that could lead to countervailing duties against China's currency in two specific cases involving coated paper and aluminum products.
US Commerce Secretary Gary Locke told Reuters on Tuesday he did not know how much longer it would be before the department decides whether to investigate.
"We need to consult with the lawyers a little bit more, so I'm not exactly sure on the timetable by which we have to make a decision on that," Locke said, after an event touting his department's handling of the 2010 census.