Bush Says Will Prod China's Hu on Fair Trade

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Bush Says Will Prod China's Hu on Fair Trade

By REUTERS
Published: March 29, 2006

WASHINGTON (Reuters) - President George W. Bush said on Wednesday he would insist Beijing provide fair treatment for American products when he meets next month with Chinese President Hu Jintao.

``I will make it clear to the president that our relationship is vital on a variety of fronts. One such front is the economy and we expect that country to treat us fairly,'' Bush said during a question-and-answer session at a foreign policy forum.

The Bush administration is urging China to drop a ban on American beef and take other steps to open its market to more U.S. goods and services.

He also called for stronger Chinese action to stamp out piracy and counterfeiting that is estimated to cost American companies billions of dollars in lost sales every year.

Bush, who will host Hu at the White House on April 20, did not directly mention China's currency practices.

But he called for fair treatment of American manufacturers, who complain that Beijing's cheap yuan policy gives Chinese companies a huge unfair trade advantage.

The currency issue dominated a Senate Finance Committee hearing on Tuesday on trade relations with China.

Treasury Undersecretary for International Affairs Tim Adams told lawmakers China had been ``far too cautious'' in loosening its rigid currency policy.

``Encouraging China to move more rapidly to a more market-based, flexible exchange-rate regime is Treasury's No. 1 priority,'' Adams said.

The Bush administration has hoped to clear the way for a successful presidential meeting by making progress on piracy and other trade concerns at high-level U.S-China trade meeting in Washington on April 11.

However, Commerce Undersecretary Franklin Lavin told reporters after the Senate hearing that preparations for that meeting were not going as well as he hoped.

``We still have a few weeks to go,talks that might get us to where we need to be. But the major issues still remain unresolved,'' Lavin said.

Deputy U.S. Trade Representative Karan Bhatia said the Washington was preparing if necessary to bring several cases against China at the World Trade Organization.

The United States and the European Union have been working together to persuade Beijing to end what they consider the discriminatory treatment of foreign auto parts.

``We'd like to see it resolved now,'' Bhatia said.

The United States is also mulling possible WTO action against China for failing to adequately enforce its intellectual property rights laws, Bhatia said.

Although China promised in April 2004 to significantly reduce piracy and counterfeiting, it has not made much of a dent in the problem, he said.

Several Democrats blamed Bush for a steel pipe company's recent decision to close its Sharon, Pennsylvania plant.

Bush's decision to deny the industry's request for protection from Chinese imports was the final blow for the Wheatland Tube facility, the Democrats said.

Bhatia defended the decision, saying the cost to the economy of providing the relief outweighed any benefits. Other foreign suppliers also would have increased exports to the United States if Chinese shipments were curbed, he said.