By Agence France-Presse A group of senators proposed Sept. 9 an across-the-board tariff increase of 27.5% on Chinese imports in a bid to prod Beijing to drop its nearly decade-old currency peg to the U.S. dollar. Although the proposal would likely face a difficult legislative road, it illustrated the growing sentiment in Washington, D.C., that China is using an artificially low currency to gain advantages in global trade. "The Chinese want to have it both ways: On one hand they want free trade and want membership in the WTO [World Trade Organization] and other international trade organizations. But on the other hand, they don't want to play by the rules of those organizations," said Sen. Charles Schumer, a New York Democrat who is leading the effort to pressure the Bush administration to spur China to change its currency policy. "This legislation is a tough-love effort to get the Chinese to stop playing games with their currency in order to level the playing field for American companies trying to compete with goods and service coming from China." The bills sponsors also include Democratic Sens. Evan Bayh of Indiana and Illinois' Richard Durbin, as well as Republicans Jim Bunning, Ky., Elizabeth Dole, N.C., and Lindsey Graham, S.C. The lawmakers note that U.S. manufacturers complain that the fixed Chinese exchange rate provides an unfair cost advantage to China's exports and is therefore costing U.S. jobs. "There is no question that China's unfair trade practices have played a major role in the loss of millions of U.S. manufacturing jobs," said Bunning. "This legislation is a shot across the bow to let the Chinese government know that the United States is serious and committed to making sure that China lives up to the principles of free and fair trade." Says Jerry J. Jasinowski, president of the Washington, D.C.-based National Association of Manufacturers (NAM), ""China needs to take this issue seriously and move quickly to end the undervaluation of the yuan and allow markets to determine the currency's value, rather than government intervention," U.S. Treasury Secretary John Snow raised the currency issue unsuccessfully with the Chinese government in a trip to Beijing last week. China has fixed its currency at roughly 8.3 yuan to the dollar since 1994, and Chinese Premier Wen Jiabao told Snow that it is in both Chinese and US interests to maintain the stability of the yuan. --
IW contributed to this report. Copyright Agence France-Presse, 2003
