*EPF410 09/11/2003
House Bill Would Require Treasury Department to Monitor Yuan
(H.R. 3058 pegs tariffs to China's manipulation of its currency rate) (520)

By Steve La Rocque
Washington File Staff Writer

Washington - A phalanx of Republican lawmakers in the House of Representatives wants to pass a law that would impose across-the-board tariffs on Chinese imports if China were found to be manipulating the exchange rate between the Chinese yuan and the American dollar, according to a description of the proposed bill in the Congressional Record.

Representative Phil English (Republican of Pennsylvania) introduced H.R. 3058 in the House of Representatives September 10. The proposed legislation was then referred to the House Ways and Means Committee for action.

H.R. 3058 would require the Secretary of the Treasury to analyze and report to Congress on the exchange rate policies of the Chinese government. The proposed bill would also require the imposition of additional tariffs on products from China based on how much the Chinese government manipulated the exchange rate of the Chinese yuan to the American dollar.

H.R. 3058's 36 co-sponsors, all Republicans, include Representative Duncan Hunter of California, the chairman of the House Armed Services Committee, and Representative Dana Rohrabacher of California, a member of the House International Relations Committee and a frequent critic of the Chinese government.

Representative English is the chairman of the Congressional Steel Caucus, and has frequently complained of the effects of unfair trade practices on U.S. industries and their workers.

Congressman English is also a member of the House Ways and Means Committee's subcommittee on trade, which would be the first body to take up the proposed bill, and serves on the Joint Economic Committee of Congress.

Representatives English, along with other co-sponsors Cass Ballenger (Republican of North Carolina) and Mark Green (Republican of Wisconsin), held a news conference on Capitol Hill September 10 to announce H.R. 3508 and to push for a floating yuan.

The goal of the legislation, according to its supporters, is to allow the yuan to reach an exchange rate based on its true value, instead of being kept at an artificially low rate of exchange in relation to the dollar.

Representative Ballenger is a member of the House International Relations Committee, while Representative Green serves on the House International Relations Committee and the House Financial Services Committee. Green is also a member of the Republican Policy Committee.

House Republicans, who usually support the President on trade issues and are more likely to support open markets and free trade than their Democratic counterparts, are following the lead of a bipartisan group of senators. The senators submitted a bill that would impose a 27.5% duty on all Chinese imports if China did not take steps to allow its currency to be valued by the marketplace instead of by government fiat.

Senator Charles Schumer (Democrat of New York) introduced S. 1586 September 5, and the proposed bill was referred the Senate Finance Committee for action.

According to the backers of the Senate bill, the yuan's under-valuation has played "a major role in the loss of 2.6 million U.S. manufacturing jobs since March 2001."

(The Washington File is a product of the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)

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