U.S. shippers urge “even-handed” trade policies for China

U.S. shippers urge “even-handed” trade policies for China

U.S. shippers urge “even-handed” trade policies for China

   With Congress showing increased hostility toward China, American shippers urged lawmakers to use an “even handed” approach to its China trade policy.
   “We believe improved behavior results from the constant application of even-handed pressure to respect trade agreements through discussions and negotiations,” testified Neal Bredehoeft, president of American Soybean Association, before the Senate Finance Committee Thursday.
   Shippers are particularly concerned about an economic backlash if U.S. policy strikes a trade war with China. Congress is already considering retaliatory measures to force China to revalue its currency and increase enforcement of intellectual property rights.
   Many Capitol Hill lawmakers were also rattled this week by an offer from the China state-owned oil company Cnooc Ltd. to buy U.S. energy company Unocal Corp.
   American shippers don’t disagree that China still has had its share of non-trade-friendly measures in place. In 2002, the Chinese government used a tedious system of import permits and safety certificates for imports of U.S. soybeans. However, American shippers generally believe China has made strides to open its markets and change its practices since becoming a member of the World Trade Organization four years ago.
   “Since China’s accession to the WTO in 2001, there has been remarkable progress in our ability to ship products to China,” said Sean Maloney, executive vice president and general manager of Intel Corp.’s Mobility Group, to the Senate Finance Committee.
   China’s tariffs on most high-tech products immediately dropped to zero when China joined the WTO’s Information Technology Agreement. “Since the year 2000, U.S. semiconductor exports to China have increased by just over 200 percent,” Maloney said.
   American shippers believe China must do more to comply with its WTO obligations and ensure fairness for U.S. products.
   “Bringing China into the WTO required it to begin following the same trade rules as the rest of the world and to open its markets more fully,” said Al Lubrano, president of Rhode Island-based Technical Materials, to the Senate committee on behalf of the National Association of Manufacturers. “We now need to see that China implements its obligations fully — particularly in areas such as protecting intellectual property.
   “We must avoid damage to the entire global trading system because we have failed to address problems in our trading relationship with China in a positive way,” he added.
   Bredehoeft reminded lawmakers about the negative economic impact of past heavy-handed retaliations. He explained how the U.S. government’s 1980 grain embargo against the Soviet Union sent a “shock wave through world agricultural markets” with lasting consequences for American farmers.
   “Not only were the Soviets able to source wheat and soybeans from alternative suppliers, but other major U.S. customers decided we were an unreliable supplier,” Bredehoeft said. “The Japanese, in particular, invested heavily in development of soybean production in southern Brazil. Today, Brazil has become our largest competitor for soybean exports and is rapidly emerging as an aggressive seller of cotton, sugar, livestock, and biofuels products.”