Provisions, Pending Agreements Shadowing China 'Victory'

Much of the Washington business community, the GOP leadership in the U.S. House of Representatives, and the White House are congratulating themselves on the surprisingly wide margin (237 yeas to 197 nays) by which permanent normal trade relations (PNTR) between the U.S. and China won approval on May 24. And although Senate approval next month to the measure remains likely, backers of PNTR shouldn't declare victory yet. A couple of oversight provisions added to the measure in the House to secure the majority needed for passage could create problems for "clean-bill" trade purists in the Senate. One is a commission to monitor China's human-rights and trade practices; the other would protect selected U.S. industries against import surges from China. What's more, notes Mike Moore, director general of the World Trade Organization (WTO), China has yet to complete market access agreements with Mexico, Switzerland, Guatemala, Ecuador, and Costa Rica, another step that must be taken before China gains WTO membership and U.S. industry gains the benefits of the Sino-U.S. trade pact signed last November. That agreement would reduce Chinese tariffs, cut quotas, and liberalize investment.

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