Congress responds to increased foreign competition for manufacturing.

In May, the Commerce, Justice, State (CJS) Appropriation Subcommittee held a hearing in which two foundry owners testified on the effects Chinese imports are having on the U.S.' manufacturing, agricultural and pharmaceutical industries. As a result of the concerns raised, the CJS Appropriation Subcommittee, which funds the Dept. of Commerce and the Office of the U.S. Trade Representative (USTR), set aside $2 million in the USTR's budget to specifically respond to issues involving trade with China.

As a result, the CJS Appropriation Subcommittee passed the fiscal year 2004 CJS spending bill that was later approved by the U.S. House of Representatives and calls for major changes at the International Trade Administration (ITA) and USTR by providing nearly $35 million more than last year to address the Bush Administration's expansive trade agenda and to enforce existing trade commitments.

The spending plan retools the ITA, creating an assistant secretary for manufacturing and services to focus on maintaining a strong U.S. manufacturing base. It also consolidates trade promotion efforts under the assistant secretary for trade promotion position. Presently, these efforts are spread throughout ITA. In addition, the bill restructures ITA's Import Administration to create senior level positions to oversee antidumping investigations, countervailing duty investigations, and policy and negotiations. The bill also establishes an Office of China Compliance, specializing in antidumping cases. The measure also requires USTR to devote the necessary resources to ensure China is fully complying with the obligations of the World Trade Organization WTO bilateral accession agreement, including the section 421 special safeguard intended to address surges in cut-rate Chinese imports.

The Senate has yet to introduce their version of the legislation. Once the Senate has voted on the legislation, the two bills will be sent to a Conference Committee to work out the differences. The AFS Washington Office continues to monitor the status of these bills.