WASHINGTON, Feb 15 (AFP): The US administration announced yesterday the creation of a task force to ensure Chinese compliance with global trading rules, saying US trade with China "lacks equity, durability and balance".
Faced with a vast trade deficit with China, US Trade Representative (USTR) Rob Portman said Washington would take new steps to ensure Beijing's compliance with international trade obligations.
"Despite three consecutive years of growing US exports to China, our bilateral trade relationship with China today lacks equity, durability and balance in the opportunities it provides," Portman told reporters.
"The time has come to readjust our trade policy with respect to China."
He warned that Washington was prepared to pursue "legal options" if China did not take steps to address outstanding issues such as "inadequate" protection of intellectual property rights and rules that "discriminate" against imported auto parts.
Portman, releasing the results of a "top-to-bottom review" of trade with China, said his office would expand trade enforcement and establish "a China Enforcement Task Force" to be headed by a chief counsel for China trade.
The move was "unprecedented" but "this kind of dedicated, country-specific enforcement team is needed to improve China's compliance and obligations," he said.
The review also called for the expansion of US trade negotiating capacity in Beijing, a new senior legal advisory task force on China trade policy and the dedication of new China- specific resources at USTR.
Some of the steps would be taken in coordination with US trading partners, especially the European Union and Japan, Portman said.
The announcement came days after a US trade report showed the politically sensitive deficit with China widened to 201.6 billion for 2005, up 24.5 per cent for the year, drawing fierce protests from Congress and American industry.
Critics of Beijing claim China gets unfair trade advantage by manipulating its currency and providing a variety of subsidies. Additionally, say critics, Chinese markets are often difficult for US firms to enter.
"As a mature trading partner, China should be held accountable for its actions and required to live up to its responsibilities including opening markets and enforcing intellectual property rights," Portman said.
"We will use all options available to meet this challenge."
The review also announced new mechanisms for enhanced interagency coordination within the US administration, and called for regular coordination with Congress on implementing an effective China trade policy.
"There's a growing impatience in Congress with China's slowness in addressing key issues, such as currency reform and the enforcement of intellectual property rights," said Senator Chuck Grassley, who heads a finance committee with international trade oversight.
Earlier this month, two US senators proposed legislation that would repeal permanent normal trade relations (PNTR) status for China granted in 2000 and which paved the way for the most populous nation to enter the World Trade Organisation.
Senators Byron Dorgan and Lindsey Graham, co-authors of the bipartisan measure, said the status should be rescinded in retaliation for China's unfair trade practices which they said were responsible for the huge US trade deficit.