In an effort to prevent trading partners from manipulating their currency, a cross-section of U.S. manufacturers and industrial groups on Tuesday signed a letter to U.S. Treasury Secretary Timothy Geithner and U.S. Trade Representative Ron Kirk urging them to include rules governing currency manipulation as a key point of any future trade agreements.
Signatories to the letter include trade associations representing American automakers and the auto parts supply chain, steel producers, and other high-tech manufacturers. The groups priority is to see that negotiations toward a potential Trans-Pacific Partnership (TPP) include language to address deliberate currency undervaluation among trading partners.
Administration negotiators say they hope to conclude a TPP agreement within the year. In a recent statement, Kirk's office called the proposed agreement an "important element of the Obama Administrations efforts to support the creation and retention of high-quality jobs for Americans by increasing exports to the vibrant economies of the Asia-Pacific region."
"We want to keep this recovery in motion, but nothing can erode the benefits of more open trade, or stop a manufacturing recovery faster, than predatory currency manipulation," said Scott Paul, executive director of the Alliance for American Manufacturing. "The U.S. should use all possible leverage in the TPP negotiations to ensure that currency issues are strongly and clearly addressed."
The coalition shares a concern that competitive devaluation of currency can distort world markets and impede open trade. In their letter, they urge that "strong currency disciplines" be included in all future U.S. free trade agreements to "foster multilateral consensus against the use of currency manipulation to gain an unfair competitive advantage."
Signatories to the letter include: Alliance for American Manufacturing (AAM), American Automotive Policy Council (AAPC), American Fiber Manufacturers Association (AFMA), American Iron and Steel Institute (AISI), American Mold Builders Association (AMBA), Association for Manufacturing Technology (AMT), Information Technology and Innovation Foundation (ITIF), Motor & Equipment Manufacturers Association (MEMA), National Council of Textile Organizations (NCTO), and Steel Manufacturers Association (SMA).