- The Washington Times - Tuesday, May 30, 2006

President Bush’s choice as the country’s top trade official said yesterday that the administration would consider filing a case against China at the World Trade Organization if the country does not open its market to U.S. financial service firms by the end of the year.

“[The Office of the U.S. Trade Representative] is prepared to use the WTO dispute settlement process whenever we determine that the process would be the most effective way to address the issue at hand,” said Susan Schwab in a letter to Sen. Charles E. Schumer, New York Democrat, and Sen. Lindsey Graham, South Carolina Republican.

Mr. Schumer said last week that he would delay a Senate vote to confirm Ms. Schwab until she answered a series of questions about the ability of U.S. financial service firms to invest and operate in China.

The senators yesterday afternoon had received Ms. Schwab’s letter, but Mr. Schumer had not determined whether the response was sufficiently reassuring to lift the hold. Mr. Graham is not delaying the nomination.

Mr. Schumer said last week that he was particularly concerned with reported plans by the Chinese government to maintain limits on investments and to restrict where banks can operate. He also complained that the country had failed to live up to other economic commitments.

“I simply believe that this is a very critical time for U.S. trade relations, and I felt that your responses to several of my questions at your nomination hearing, particularly as they related to China and financial services, were unnecessarily evasive and unhelpful,” Mr. Schumer said.

Ms. Schwab’s four-page response did not break new policy ground, but it reiterated the administration’s past actions against China and posture on trade-related issues.

She said more needs to be done to help U.S. financial service firms.

“I also agree that China’s actions to date to open its financial service markets have been inadequate,” Ms. Schwab said.

On joining the WTO in 2001, China committed to removing all ownership limitations in the banking sector by December 2006.

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