110 HR 1002 IH: To authorize appropriate action if the negotiations with
U.S. House of Representatives
2007-02-12
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EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
1.Congress makes the following
findings:
(1)The
currency of the People’s Republic of China, the yuan, is artificially pegged at
a level significantly below its market value. Economists estimate the yuan to
be undervalued by between 15 percent and 40 percent or an average of 27.5
percent.
(2)The undervaluation
of the yuan makes exports from the People’s Republic of China less expensive
for foreign consumers and makes foreign products more expensive for Chinese
consumers. The effective result is a significant subsidization of China’s
exports and a virtual tariff on foreign imports, leading the People’s Republic
of China to enjoy significant trade surpluses with its international trading
partners. The United States trade deficit with China has widened from
$83,800,000,000 in 2000 to $213,548,600,000 in 2006, resulting in an aggregate
deficit with China of more than $971,093,600,000 for that 7-year period.
(3)China’s undervalued
currency and the United States trade deficit with the People’s Republic of
China is contributing to significant United States job losses and harming
United States businesses. In particular, the United States manufacturing sector
has lost more than 3,009,000 jobs since January 2001.
(4)The Government of
the People’s Republic of China has intervened in the foreign exchange markets
to hold the value of the yuan within an artificial trading range. China’s
foreign reserves are estimated to be more than $1,066,000,000,000 as of January
1, 2007, and have increased at a level higher than that of any other
country.
(5)China’s
undervalued currency and the Chinese Government’s intervention in the value of
its currency violates the spirit and letter of the world trading system of
which the People’s Republic of China is now a member.
(6)The Government of
the People’s Republic of China has failed to promptly address concerns raised
by the United States and the international community regarding the value of its
currency.
(7)Article XXI of the
GATT 1994 (as defined in section 2(1)(B) of the Uruguay Round Agreements Act
(19 U.S.C. 3501(1)(B)) allows a member of the World Trade Organization to take
any action which it considers necessary for the protection of its essential
security interests. Protecting the United States manufacturing sector is
essential to the security interests of the United States.
2.Negotiations and
certification regarding the currency valuation policy of the People’s Republic
of China
(a)Notwithstanding the provisions of title I of Public Law
106–286 (19 U.S.C. 2431 note), on and after the date that is 180 days after the
date of enactment of this Act, unless a certification described in subsection
(b) has been made to Congress, there shall be imposed a rate of duty of 27.5
percent ad valorem on any article that is the growth, product, or manufacture
of the People’s Republic of China and is imported directly or indirectly into
the United States, in addition to any other duty that would otherwise apply to
such article.
(b)The
certification referred to in subsection (a) is a certification by the President
to Congress that the People’s Republic of China is no longer manipulating the
rate of exchange between its currency and the United States dollar for purposes
of preventing an effective balance of payments and gaining an unfair
competitive advantage in international trade. The certification shall also
include a determination that the currency of the People’s Republic of China is
valued in accordance with accepted market-based trading policies.
(c)Beginning
on the date of enactment of this Act, the Secretary of the Treasury, in
consultation with the United States Trade Representative, shall begin
negotiations with the People’s Republic of China to ensure that the People’s
Republic of China adopts a process that leads to a market-based system of
currency valuation.