Petitions protesting China rejected

The Bush administration yesterday rejected petitions by labor and manufacturing groups that said China’s policies give the country an unfair advantage in international trade.

The administration’s top trade, economy and labor officials said the decision to reject labor rights and currency petitions reflected a policy of “economic engagement” over “economic isolationism,” a swipe at Democrats who have advocated trade barriers to counter China’s surging exports.

“Accepting these petitions would take us down a path of economic isolationism. That is a path we will not take,” said U.S. Trade Representative Robert B. Zoellick.

China’s economy has grown rapidly and the country has increased sales to the United States, prompting worry by workers and manufacturers that jobs and companies will disappear under intense competition.

Chinese Prime Minister Wen Jiabao told Reuters news agency yesterday that his country needs “very forceful” measures to slow its fast-growing economy but also must maintain stability.

At a joint press conference, Mr. Zoellick, Treasury Secretary John W. Snow, Commerce Secretary Donald L. Evans and Labor Secretary Elaine L. Chao said they preferred to take advantage of that fast growth by increasing U.S. exports to China, rather than broadly raising trade barriers.

Democrats quickly chastised the administration for not doing enough to protect jobs from going overseas.

“The simple fact is that this administration has once again refused to make any serious effort to use the legitimate rules that govern trade to level the playing field and prevent our businesses and workers from being taken to the cleaners,” said Sen. John Kerry, Massachusetts Democrat and presumptive presidential nominee.

Democrats have urged a get-tough policy with China — to be implemented with more cases submitted to the World Trade Organization and more vigorous use of U.S. trade laws to punish the Asian country when its products flood the United States or its policies block U.S. sales.

The AFL-CIO labor federation last monthdemanded that the Bush administration investigate workers’ rights violations. AFL-CIO President John J. Sweeney said yesterday’s decision to reject the petition was “an outrage and an insult to American and Chinese workers.”

The Fair Currency Alliance, a group of manufacturers and unions, had planned a petition that would blame China for undervaluing its currency by as much as 40 percent, effectively making its exports cheaper and giving its manufacturers an unfair advantage.

That petition now is unlikely to be formally filed, said Frank Vargo,vice president for international economic affairs at the National Association of Manufacturers (NAM), a trade association. NAM was taking the lead on the petition.

Mr. Vargo said he still hoped to work with the president’s economic team to find a solution to the currency issue.

Mr. Wen told Reuters that China must be careful in reforming its fixed currency.

“As to how and when this [reform] can be started, we must be very prudent,” he said.

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