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China Currency Coalition Submits Testimony to Capitol Hill on Undervalued Yuan and Injurious Impact to U.S. Manufacturers and Workers

(Washington, D.C.) (April 14, 2005) – In written testimony submitted today on behalf of the China Currency Coalition (CCC) to the House Ways and Means Committee, a steel company executive from Fort Wayne, Indiana, stated that the single greatest commercial disadvantage that the United States faces is China’s manipulation of its currency and that the situation is urgent.

The statement of John Nolan, Vice President and Manager of Sales and Marketing for Steel Dynamics, Inc.(SDI), related to the Committee’s hearing on United States-China Economic Relations and China’s Role in the World Economy. Nolan contends that the undervaluation of the yuan acts both as a subsidy for Chinese exports to the United States and third countries and as a hidden duty on U.S. products that would be imported into China. He voiced strong support for two pieces of legislation recently introduced that rightfully identify exchange-rate issues as international trade issues and China’s undervaluation of the yuan by about 40 percent as inconsistent with its obligations as a member of the World Trade Organization (WTO).

The Chinese Currency Act of 2005 was introduced last week and would amend the U.S. countervailing duty statute and the China-specific, market-disruption statute to enable U.S. industries and workers to pursue relief against subsidized, injurious imports into the United States from China. The legislation also generally prohibits the Secretary of Defense from procuring Chinese-origin products if the Secretary determines that U.S.-made products like the imports from China are critical to the United States defense industrial base. The second piece of legislation, The Stopping Overseas Subsidies Act, would clarify that the U.S. countervailing duty statute applies to imports from nonmarket-economy countries. Both bills have been carefully drafted to be WTO-consistent.

The Stopping Overseas Subsidies Act (H.R. 1216) was introduced by Congressmen Phil English (R-PA) and Artur Davis (D-AL), and The Chinese Currency Act of 2005 (H.R. 1498) was introduced by Congressmen Tim Ryan (D-OH) and Duncan Hunter (R-CA). These initiatives also received the support of the American Iron and Steel Institute (AISI) and the Steel Manufacturers Association (SMI). SDI is a member of AISI and SMA, also represented in the testimony, and the CCC.

The China Currency Coalition is an alliance of industry, agriculture, and worker organizations whose mission is to support U.S. manufacturing by seeking an end to Chinese currency manipulation. The full text of Mr. Nolan’s testimony can be viewed at www.chinacurrencycoalition.org/others/041405.html.

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