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Grassley to China: Honor WTO commitments

WASHINGTON, D.C. — Sen. Chuck Grassley, R-Iowa, wants producers to know that he's holding China accountable to the promises it made in exchange for membership in the World Trade Organization.

"It's time for China to abide fully by its international trade commitments," says Grassley, who serves as chairman of the Senate Committee on Finance.

"We want to make sure American farmers and factory workers get the full measure of benefits on which our trade partners agreed. And China needs to do more, especially in agriculture," he says. "China is still using unreasonable scientific standards for agricultural biotech products, is still not fulfilling its agricultural quota commitments, and is manipulating its taxes to distort international trade."

A supporter of open trade agendas, Grassley supported the development of permanent normal trade relations for China and China's accession to the World Trade Organization.

An Oct. 7 letter to China's Minister of Commerce, however, illustrates Grassley's disappointment in China's apparent lack of commitment to abiding by their trade agreements with the United States.

"I had great faith in China's commitment to the WTO and to the rule of law. I hope my faith was not misplaced," he says. "China will not reap the full economic and political benefits of WTO membership unless China faithfully and fully abides by its WTO accession agreement. At the same time, U.S. farmers and workers will not receive the full measure of benefits from our trade agreements unless a serious effort is made to ensure that our trading partners abide by their international trade commitments and free market principles."

So far, Grassley says, that hasn't been the case.

"There are multiple reports stating that China is failing to fulfill its WTO obligations. It's time to take more action," he says.

Grassley calls China's uneven implementation of its commitments regarding transparency a "disappointment." In addition, he says China is utilizing unreasonable standards for agricultural biotech products, is unfairly applying quotas and providing export subsidies, is utilizing discriminatory tax policies on imports, is failing to provide protection for U.S. intellectual property rights, and is maintaining high capital requirements for establishing service businesses.

China is also well-aware, Grassley says, that a fairly valued currency is in China's own long-term interest, and is key to moving to a market-driven economy. "The best international economic system is one based on the principles of free trade, open markets, free capital flows, and market-based exchange rates among major economies. Even the International Monetary Fund and the World Bank agree that China must address this issue," he says.

In his letter, Grassley asks China to carefully consider the importance of abiding by both the "letter and the spirit" of its WTO commitments.

"While I and many others stand ready to work with China's government to resolve these trade problems, pressure is mounting within Congress and the Administration for concrete action," Grassley says. "It is my hope that China will make good progress in the near future so that we can eliminate the need for any such measures."


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