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TRADE WARS
US, China talk trade as disputes swirl

by Staff Writers
Washington (AFP) Dec 13, 2010
US officials get a fresh chance to hammer home their message that China must do more to open its doors to American exports Tuesday, when top trade officials from both countries meet.

As US leaders fret at the slow pace of economic growth and the Chinese authorities tackle rising inflation spurred by a super-hot economy, trade negotiators were to meet in Washington for annual talks.

The disparate economic view from the offices of power in Washington and Beijing has fueled US anger at perceived Chinese protectionism.

Amid fierce debate over the rate of the Chinese currency -- which Washington says is kept artificially weak to aid Chinese manufacturers -- top US officials are expected to press their case.

As part of the meetings, which will end Wednesday, Chinese Vice Premier Wang Qishan will hold talks with US Secretary of Commerce Gary Locke and US Trade Representative Ron Kirk.

In a snapshot of the distance between two sets of negotiators, the eve of the meeting was marked by a World Trade Organization ruling against China in a tire dispute, congressional moves to sanction Beijing and a US report that was critical of China's efforts to tackle copyright infringement.

Two US senators on Monday sought to introduce legislation targeting China over alleged currency manipulation to a bill championed by President Barack Obama to avert a massive New Year's tax increase.

Republican Olympia Snowe and Democrat Sherrod Brown said they had introduced the "Currency Reform for Fair Trade Act" as an amendment to the tax measure.

The act would direct the US Commerce Department to treat deliberate currency undervaluation as a forbidden export subsidy, paving the way to countervailing duties on exports from the offending country.

Although the effort was not expected to succeed it was a poignant symbol of congressional anger.

Meanwhile the WTO on Monday rejected China's complaint against punitive US tariffs on Chinese tires, a landmark ruling on safeguards invoked by Washington against disruptive imports from the Asian giant.

The US "did not fail to comply with its obligations," the ruling by the World Trade Organization dispute settlement panel said.

Washington welcomed the ruling as a vindication of its policies, but scores of other disputes are still being considered by the WTO.

Also on Monday the US International Trade Commission published a nearly 200 page report on Chinese infractions against intellectual property rights.

"Infringement in China -- including violations of copyrights, trademarks, patents, and trade secrets -- remains a central area of US concern in the bilateral trade relationship," the report concluded.

Senate Finance Committee chairman Max Baucus on Monday said it was "time for China to get serious about protecting American innovation."

"Small steps and empty promises won't cut it when American jobs are on the line. This week's US-China trade talks are the perfect opportunity for China to make serious commitments to address these issues. It is time for action."

Earlier more than 30 members of the House Ways and Means Committee signed an appeal to Commerce Secretary Locke and Trade Representative Kirk.

"We urge you to secure robust commitments from China that will protect the range of US industries, such as software, entertainment, and technology, harmed by the continued massive theft of their intellectual property and onerous and discriminatory market access restrictions in China," the signatories said.

Despite a recent surge in US exports there is still a feeling in Washington that China is not enough has been done to rebalance global trade.

The US trade deficit narrowed sharply in October as exports surged on the back of a weaker dollar and the politically sensitive gap with China shrank 8.3 percent, to 25.5 billion dollars.

A succession of global economic meetings, from gatherings of the International Monetary Fund to the G20 have been dominated by trade tensions between the United States and China.

With little concrete action toward resolving the disputes, they threaten to engulf a visit of President Hu Jintao to Washington in January.

The visit is seen by many as an important deadline for China to let the value of the yuan increase.



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