China Agrees To Trade Moves, Manufacturers Cautious

A week before President Hu Jintao's visit to Washington, D.C., China has agreed to take several steps that, if implemented, would ease trade tensions with the U.S. China says it will require that computers use legal software, close plants making pirated CDs and DVDs, step up intellectual property protection, eliminate trade barriers for medical devices and begin a dialog on the steel industry. The pledges were made public following a meeting of the U.S.-China Joint Commission on Commerce and Trade (JCCT) in Washington, D.C., on April 11.

"The NAM appreciates any positive movement in the trade relationship. However, as helpful as these individual steps are, they need to be followed by systemic changes that will put our trade relationship on a more fair basis without Chinese government intervention skewing the trade flows," said Frank Vargo, vice president for international economic affairs at the Washington, D.C.-based National Association of Manufacturers (NAM).

For more than two years, the NAM has been in the forefront of U.S. trade associations urging the Bush Administration to put pressure on China to revalue its currency. A seriously undervalued Chinese currency puts U.S. manufacturers at a competitive disadvantage, contends the NAM.

"We're not asking for special favors," insisted Vargo. "We just want the same thing that we give our Chinese partner -- a flexible currency, market access and intellectual property rights protection."

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