USTR Announces Readjustment of U.S.-China Trade Policy To Strengthen Enforcement

According to the press release, the report, entitled "U.S.-China Trade Relations: Entering a New Phase of Greater Accountability and Enforcement," is the first comprehensive statement of U.S. trade policy towards China since it joined the World Trade Organization (WTO) in 2001.

This report was to be provided to the House Ways and Means Committee and the Senate Finance Committee as part of recent hearings (February 15, 2006 and February 16, 2006, respectively) on the Administration's trade policy. (See ITT's Online Archives or 02/10/06 news, 02061015, for BP summary of House Ways and Means hearing.)

In a statement, the USTR states that despite three years of growing U.S. exports to China, the U.S.-China bilateral trade relationship today lacks equity, durability and balance in the opportunities it provides. The USTR also states that the time has come to readjust U.S. trade policy with respect to China and that the U.S. will use all options available.

USTR's Report Announces Actions That Will be Implemented

The USTR's report announces the following actions that will be implemented in consultation with Congress and other stakeholders to ensure meaningful progress in achieving the key objectives outlined in the USTR's report:

Establish USTR China Enforcement Task Force. The USTR's trade enforcement capacity will be expanded to better ensure China's compliance with trade obligations, including through establishment of a China Enforcement Task Force at USTR, to be headed by a Chief Counsel for China Trade Enforcement;

Add USTR personnel, establish advisory committee, The USTR's capability to obtain and apply comprehensive, forward-looking information regarding China's trade regime and practices to U.S. trade policy formulation and implementation will be expanded by: (1) adding personnel to USTR's China office to coordinate collection and integration of information on current and potential China trade issues from other U.S. government agencies and other sources; and (2) establishing an Advisory Committee for Trade Policy and Negotiation (ACTPN) China Task Force to provide strategic advice and recommendations related to U.S.-China trade policy;

Expand U.S. trade policy and negotiating capacity in Beijing, etc. U.S. trade policy and negotiating capacity in Beijing and other resources in China will be expanded to more effectively pursue top priority issues, especially the protection of intellectual property rights;

Increase coordination with other trading partners on China trade issues. Coordination with other trading partners on China trade issues of common interest, such as enforcement of intellectual property rights, will be increased;

Deepen and strengthen trade relations with other Asian economies and APEC. Trade relations with other Asian economies, and within the Asia-Pacific Economic Cooperation (APEC) forum, will be deepened and strengthened to maintain and enhance U.S. commercial relationships in the region;

Increase focus on regulatory reform in China. The focus on regulatory reform in China will be increased, including through initiating a high-level dialogue on steel with China under the U.S.-China Joint Commission on Commerce and Trade (JCCT), deepening and expanding the State Department's high-level dialogue with China's economic planners regarding structural reform, launching an initiative to evaluate, assess and engage on China's subsidies issues, expanding initiatives led by the U.S. Department of Agriculture (USDA) to improve China's transparency and compliance with its sanitary and phytosanitary (SPS) obligations under the WTO, and focusing intensive interagency efforts to address China's development of standards and of an anti-monopoly law;

Increase effectiveness of high-level meetings with China's leaders. The effectiveness of high-level meetings with China's leaders will be increased, including through holding annual, elevated meetings of the JCCT prior to presidential-level meetings where possible and conducting mid-year reviews of goals and progress under the JCCT at the Vice Minister/Deputy level;

Strengthen and expand dialogue on specific issues of significance. The US-China dialogue on numerous other specific issues of significance to the global trading system and on bilateral trade issues that pose potential problems for the relationship, including, e.g., China's participation in global institutions; market access and standards issues related to telecommunications, financial services, healthcare and direct sales; subsidies and structural issues, especially in the steel industry; standards; labor; environmental protection; and transparency and the rule of law, will be strengthened and expanded;

Strengthen U.S. government interagency coordination. U.S. government interagency coordination will be strengthened, including through monthly review, by the Trade Policy Review Group and Trade Policy Staff Committee, of strategies and progress made in achieving the key objectives identified in the USTR's report; and

Strengthen Executive-Congressional partnership on China trade. The Executive-Congressional partnership on China trade will be strengthened, through initiation by USTR of a program of regular briefings for Congressional members and staff, to update them on progress in pursuing the objectives outlined in the USTR's report and to ensure that the Administration's China trade policy is informed by Congressional priorities.

USTR press release (dated 02/14/06) available at http://www.ustr.gov/Document_Library/Press_Releases/2006/February/USTR_to_Strengthen_Enforcement_in_Readjustment_of_US-China_Trade_Policy.html.

USTR report (dated February 2006) available at http://www.ustr.gov/assets/Document_Library/Reports_Publications/2006/asset_upload_file921_8938.pdf.

USTR's opening remarks at House Ways and Means Committee's hearing on Administration's trade agenda (dated 02/14/06) available at

http://www.ustr.gov/assets/Document_Library/Transcripts/2006/February/asset_upload_file148_8947.pdf.