NAFTA steel industry endorses key trade conclusions of U.S.-China commission report

Representatives of the NAFTA steel industry endorsed key trade conclusions of the recently released “November 2005 Report to Congress of the U.S.-China Economic and Security Review Commission.”

The American Iron and Steel Institute (AISI), Canadian Steel Producers Association (CSPA), Mexican Steel Producers Association (CANACERO), Specialty Steel Industry of North America (SSINA) and Steel Manufacturers Association (SMA) all agreed that:

First, understanding China’s economic strategy and, then, addressing this strategy in an effective way, constitutes the greatest economic and security challenge facing North America.

In this regard, the five major NAFTA steel associations all endorse the conclusions that:

•The existing trade tools remain underutilized, are inadequately enforced and should be strengthened in the context of addressing unfair and disruptive imports of manufactured goods from China;
•China continues to derive artificial competitive advantages from its undervalued currency, extensive government subsidies, failure to protect intellectual property rights, denial of fundamental worker rights and lack of environmental controls;
•China’s recent exchange rate policy “reform” was an extremely limited and inadequate step;
•There is a need to increase the pressure significantly on China to allow the renminbi to appreciate by at least 25 percent against the United States dollar ;
•China’s currency, subsidy and other unfair trade practices are causing significant harm to competitive United States and North American manufacturers;
•China remains a non-market economy, and it continues to violate many of its WTO commitments;
•Transparency and accurate data disclosure remain very inadequate in China;
•The economic strategy of China is to focus on (1) the strategic accumulation of productive capacity, (2) export-led growth and (3) long-term access to raw materials and energy resources;
•China’s economic strategy has important national security implications for the United States and North America as a whole.

In view of these conclusions, NAFTA steel producers are urging the Executive Branch in all three countries to review all aspects of current trade policy toward China — and to take, as an important starting point for this reevaluation, the findings and recommendations of the November 2005 U.S-China Commission Report.