US Launches Effort to Shrink Trade Deficit with China
Luis Ramirez Beijing 22 Oct 2003, 14:01 UTC
The United States is demanding that Chinese leaders do more to shrink the large U.S.-China trade deficit. Trade Representative Robert Zoellick met with Chinese officials and conveyed Washington's growing frustration over a ballooning trade deficit. Last year's U.S.-China trade imbalance reached $103 billion. The gap has fueled political anger in the United States by some who blame it for the loss of millions of American jobs. Mr. Zoellick said China must do more to reduce the trade deficit. "The size of the bilateral trade imbalance combined with the large global U.S. current account deficit is one of the factors that is driving the United States to say, 'Look, we want to have a fair and open shot at the Chinese market,'" he explained. "I do not believe that our goal should be to close the U.S. market. I believe our goal should be to make sure that we open up China's market." Opening its markets was the key condition of China's admission to the World Trade Organization nearly two years ago. Mr. Zoellick says, thus far, China's implementation is best described as mixed. He urged leaders to do more, especially in the area of intellectual property rights. Piracy continues to be a big concern, with U.S. officials complaining China has done little to stop the manufacture and export of counterfeit goods. In his meetings with Chinese officials, Mr. Zoellick says he has brought up the issue of U.S. demands for China to revalue its currency, the yuan. The Bush administration has been under growing pressure at home to get China to revalue the yuan. Some U.S. politicians argue the Chinese government is keeping its currency undervalued, unfairly making Chinese products more competitive. Speaking on the sidelines of the recent Asian Pacific Summit in Bangkok, Chinese President Hu Jintao rejected U.S. demands for China to relax controls on its currency. He said keeping the yuan's peg is necessary for China's continued economic growth. Despite China's clear statements that it will not revalue its currency in the near future, U.S. pressure is not subsiding. Commerce Secretary Donald Evans is expected to press the demand further next week when he visits Beijing.