Business Roundtable Calls for New Consensus on U.S.-China Trade

Washington, DC, USA, 20 September 2006 -- /PRNewswire/ -- Business Roundtable, representing 160 CEOs of leading American companies, today called attention to the critical state of the China trade debate in Washington and released a series of recommendations on how U.S. policymakers can most effectively address the complex issues that define the U.S.-China trade relationship. The recommendations are contained in the organization's new white paper: "Reestablishing a Consensus on U.S.-China Trade: A Principled and Realistic Approach for U.S. Policymakers," which was delivered to all Members of Congress and key Administration officials today.

"The issues related to trade with China are representative of larger questions regarding the U.S.'s position in the world economy and U.S. competitiveness," said Harold McGraw III, chairman, president, and CEO, The McGraw-Hill Companies, and Chairman of Business Roundtable. "By not distinguishing between two distinct sets of issues, policymakers and opinion leaders risk prescribing blunt solutions that will not adequately address the broad economic challenges facing the U.S., or the particular challenges of U.S.-China trade."

"There is much at stake in U.S.-China trade -- both in terms of problems to be addressed, as well as benefits to be realized -- and we should strive to reach internal consensus," McGraw said. "Addressing the problems in U.S.-China trade is critical, but we also need action to ensure U.S. global competitiveness -- we need to make our workers more competitive, eliminate the current account imbalance, and help strengthen our position within the global economy."

China is the United States' third largest trading partner, fourth largest export market, and, with the United States, a powerful engine of global economic growth. "How we manage our economic relationship with China will have profound implications for the U.S. and world economies," McGraw continued.

The Roundtable paper details some key problems that need to be addressed with China, including widespread infringement of intellectual property rights, an undervalued Chinese currency, and industrial and regulatory policies that often disadvantage U.S. businesses and workers. At the same time, Business Roundtable CEOs cautioned that "trade and investment with China serves U.S. interests in fundamental ways, and policymakers must consider these benefits in assessing the challenges and formulating responses. Without a balanced evaluation and understanding of what's at stake, the United States risks adopting policy responses" -- like the pending legislation to impose a 27.5% tax on Chinese imports -- "that cause more harm than good."

Among the Roundtable's recommendations are the following principles for policymakers to follow as a basis for reestablishing a consensus on U.S.-China trade:

* Stay true to core U.S. principles of open trade and investment;

* Deal realistically with China's position;

* Hold China accountable to international trade rules;

* Address China intellectual property rights concerns comprehensively;

* Engage with China on regulatory reform;

* Address the current account imbalance globally, rather than through a
China lens;

* Ensure U.S. export controls facilitate exports to China without
compromising national security;

* Maintain U.S. leadership in Asia;

* Keep the focus on job creation, not preserving the status quo; and

* Raise America's game through an ambitious competitiveness agenda.

To view a copy of "Reestablishing a Consensus on U.S.-China Trade: A Principled and Realistic Approach for U.S. Policymakers," visit http://www.trade.businessroundtable.org/.

Business Roundtable (http://www.businessroundtable.org/) is an association of chief executive officers of leading U.S. companies with over USD 4.5 trillion in annual revenues and more than 10 million employees. Member companies comprise nearly a third of the total value of the U.S. stock market and represent nearly a third of all corporate income taxes paid to the federal government. Collectively, they returned more than USD 110 billion in dividends to shareholders and the economy in 2005.

Roundtable companies give more than USD 7 billion a year in combined charitable contributions, representing nearly 60% of total corporate giving. They are technology innovation leaders, with USD 86 billion in annual research and development spending -- nearly half of the total private R&D spending in the United States.

Source: Business Roundtable