Latest Treasury Department Report Shows that China Is Already Backsliding on Minimal Progress that Was Made in 2013 / Senators Call for Decisive Action, End of Cycle of One Step Forward, Two Back
Washington, DC- Ahead of a major summit between the U.S. and China, U.S. Senators Bob Casey (D-PA) and Chuck Schumer (D-NY) pushed for action on China’s currency manipulation saying that the Administration’s trade agenda is in jeopardy without meaningful results on currency manipulation. In their letter to Secretary Lew, Casey and Schumer cited a recent Treasury Department report showing that China is already backsliding on the minimal progress it made on its currency undervaluation in 2013. Despite overwhelming bipartisan support, efforts to address this issue by both this Administration and the previous Administration have proved insufficient. The 2014 Strategic & Economic Dialogue (S&ED) with China represents an opportunity for the Administration to decisively confront this issue.
“It’s time for the Administration to finally take real and tangible steps to address China’s currency manipulation,” Senator Casey said. “China’s currency manipulation has cost Pennsylvania thousands of jobs. Pennsylvania’s businesses and workers deserve a fair shot to compete with anyone throughout the world. It’s impossible for our businesses and workers to get ahead when China is allowed to flaunt international law and intentionally devalue its currency.”
“Addressing China’s continued currency manipulation in this round of talks is an absolute must,” said Senator Schumer. “For far too long, China has stacked the deck against U.S. companies by undervaluing the yuan, and it’s time for this game to stop. We strongly urge Secretary Lew to make currency manipulation a major topic of discussion, and to seek real commitments from the Chinese government to abandon its efforts to rig the international markets in China’s favor.”
The full text of the Senators’ letter can be seen below:
The Honorable Jacob J. Lew
Secretary of the Treasury
Dear Secretary Lew:
As you begin the 2014 Strategic & Economic Dialogue (S&ED) with China, we implore you to use this year’s meeting to decisively confront the issue of currency manipulation.
The Administration’s efforts to date have been insufficient. Time and again, we have heralded progress only to see it eroded by China’s aggressive actions. Just last year, the Administration praised China’s commitment to addressing currency undervaluation following the S&ED. However, Treasury’s most recent Report to Congress on International Economic and Exchange Rate Policies clearly states that progress made in 2013 towards appreciation was reversed in the early months of 2014 as the yuan depreciated by “marked” 2.68 percent. It appears we take one step forward, only to take two backwards.
It is time for decisive action. Sixty members of the Senate are on the record demanding currency provisions in the Trans-Pacific Partnership (TPP). Despite overwhelming bipartisan support, efforts to address this issue by both this Administration and the previous Administration have proved insignificant. In testimony before the Senate Finance Committee on May 1, 2014, Ambassador Michael Froman clarified the Administration’s position in stating that the topic has not been raised during negotiations.
We understand that the issue rests with Treasury. As such, we would like to make clear that without inclusion of strong and enforceable currency manipulation disciplines in any future trade agreement, the President’s trade agenda, including the passage of the TPP, is in jeopardy. Therefore, we urge you to use this week’s S&ED to demand clear and measurable policies to address currency undervaluation that can serve as a template for TPP and other agreements.
Sincerely,
Robert P. Casey, Jr.
United States Senator
Charles E. Schumer
United States Senator
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