- The Washington Times - Tuesday, February 14, 2006

From combined dispatches

The U.S. trade representative pledged yesterday to use “all options available” to get China to drop barriers to U.S. exports, as the Bush administration is trying to lower the record trade deficit and stem criticism from Congress.

The State Department, meanwhile, moved to head off mounting congressional complaints over Chinese censorship of the Internet by announcing the formation of a task force to help U.S. companies like Google and Yahoo deal with foreign governments.

The trade pledge was contained in a 29-page administration review of America’s economic relationship with China that was released four days after the government reported that the U.S. recorded a $202 billion trade deficit with China last year. That is the highest ever recorded with a single country and up 25 percent from 2004.

That deficit has brought renewed pressure from Congress for President Bush to be more forceful in cracking down on what China’s critics see as blatantly unfair trade practices in currency manipulation, theft of intellectual property and China’s refusal to honor all the market-opening commitments it made when it became a World Trade Organization (WTO) member in 2001.

To prod China, at least a dozen new people will be hired in Washington and Beijing, with one new office focused entirely on getting China to live up to its commitments in the WTO, the 29-page report said. It’s the first time the U.S. has singled out one country for such scrutiny.

“Our U.S.-China trade relationship lacks equity, durability and balance,” U.S. Trade Representative Rob Portman said at a press conference announcing the findings of the 10-month study. “As a mature trading partner, China should be held accountable for its actions and required to live up to its responsibilities.”

China must crack down on the piracy of copyrighted movies, curb subsidies to exporters and end standards that discriminate against U.S. technological exports to cut its trade surplus, the U.S. trade office said.

The administration “is trying to articulate to Congress and the business community what it views as the totality of our interests with the Chinese,” said Myron Brilliant, vice president for Asia at the U.S. Chamber of Commerce. And it is saying, “Our patience isn’t going to last forever,” he said.

Democrats in Congress, labor unions and some manufacturers have blamed the widening trade gap on China’s practice of subsidizing domestic companies and holding down the value of its currency. And they have criticized the Bush administration for not doing enough to curb China’s use of these trade practices.

Sen. Lindsey Graham, South Carolina Republican, said yesterday he will force a vote in March on his legislation that would impose tariffs on Chinese goods because of China’s currency policies.

Mr. Portman released the report on China a day before he is scheduled to testify before the House Ways and Means Committee, where he is likely to face questions about the administration’s progress in breaking down trade barriers with China.

The initial reaction from Democrats to the report wasn’t positive.

“I have to ask: Where’s the beef?” said Rep. Benjamin L. Cardin of Maryland, the top Democrat on the House Ways and Means’ trade subcommittee. “The administration promises no new enforcement of trade laws, no new action in the WTO and no further steps to combat China’s unfair practices.”

A spokesman for the Chinese Embassy in Washington said China objects to the “politicizing” of commercial relations between the two countries.

“China is already addressing the trade issue quite seriously,” said Chu Maoming.

Trade with China also is threatened by concerns over its efforts to require U.S. companies to help censor e-mail and Web postings. Mr. Graham and Sen. Byron L. Dorgan, North Dakota Democrat, have argued that China should lose its most-favored-nation trading status over the issue.

At the State Department, officials said a new task force would work with U.S. Internet companies, nongovernmental organizations and Congress to address restrictions and censorship in some “repressive” countries.

The announcement came on the eve of congressional hearings in which executives from Google, Yahoo and other Internet companies will be asked to account for their cooperation with Chinese demands to censor the Web.

Google announced an agreement with Chinese government last month to move its server into China where it is more vulnerable to government censorship. Human rights groups found that two journalists in China were jailed after Yahoo submitted their e-mail to the government. Microsoft closed a Web log of a government critic at Beijing’s request.

Josette Shiner, undersecretary for economic, business and agricultural affairs, said the task force would tackle such issues as the use of technology to restrict access to political content and the effect of such censorship on U.S. companies and the use of technology to track and repress dissidents. It will meet for the first time next week.

A spokesman for China’s Foreign Ministry yesterday defended the country’s Internet controls.

“China manages the Internet according to the law in order to limit as much as possible the spread of illegal, immoral or harmful information,” Liu Jianchao told reporters, according to Reuters news agency.

Staff writer Xin Li contributed to this article.

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