Kirk Prefers Dialogue On China Disputes
Tuesday, June 2, 2009
Trade Representative Kirk today told a group of industry officials doing business in China that the Obama administration prefers to resolve trade disputes between the two countries through dialogue. But he added that, if necessary, the United States would "not hesitate to use other tools, such as dispute settlement" proceedings at the World Trade Organization.
Kirk's speech at the U.S.-China Business Council, which represents about 250 multinationals such as Boeing Co., Microsoft Corp. and Procter & Gamble Co., came as Treasury Secretary Geithner and Secretary of State Clinton issued a joint statement in Beijing announcing that Washington would host the first U.S.-China Strategic Dialogue in late July.
The dialogue "will focus on addressing the challenges and opportunities that both countries face on a wide range of bilateral, regional and global areas of immediate and long-term strategic interest," the secretaries said.
Kirk spoke positively about the benefits of trade with China, despite massive U.S. merchandise trade deficits that soared close to $270 billion last year. He noted that U.S. exports to China have increased by 273 percent since China's admission to the WTO in 2001, while U.S. exports to the rest of the world have more than tripled.
Kirk said that U.S. trade with China would continue creating more U.S. jobs "if we can work to shrink our trade imbalance with China, and if China further opens its market for U.S. goods and services."
The "preferred method of engagement with China will always be through dialogue," Kirk said, noting that the administration had recently resolved a decades-old beef dispute with the European Union. Kirk said he would apply that same approach to trade disputes with China and had already engaged in some quiet diplomacy on information security products and intellectual property rights.
But Kirk also said dispute settlement proceedings are also a "healthy" way for trading partners to resolve differences. The United States is committed to working "positively and cooperatively" with China, but it will "not yield on enforcing the right of American businesses and exporters to compete on a level playing field with China," he said.
The Obama administration faces a major test on enforcement this summer: a case at the International Trade Commission about a surge in passenger car and light truck tire imports from China.
The United Steelworkers union brought the case under Section 421 of U.S. trade law, which permits the ITC to recommend trade remedies to affected parties. The president can then decide whether to act on the recommendations.
The Bush administration chose not to exercise its authority to act and unions and their allies in Congress are looking to President Obama to change that course.
"Americans have the skill, creativity, and work ethic to compete successfully in the global marketplace. All they ask is that our government fully enforces the rules agreed to by trading nations," Sen. Sherrod Brown, D-Ohio, said this morning at the ITC hearing, where he testified on behalf of workers at two Ohio tire plants. The final ITC report to the president and USTR is due July 9.