TRADEPresident Signs US-Oman FTA Into LawPresident Bush signed into law the implementing legislation (H.R. 5684) for the US-Oman Free Trade Agreement (FTA). In a press release the White House said that "the Agreement reflects the President's commitment to opening markets and expanding opportunities for American workers, farmers, ranchers, and businesses." United States Trade Representative (USTR) Susan Schwab stated that "the $1 billion, two-way trade relationship between the United States and Oman is now set to grow." She also noted that "on the first day this agreement goes into effect, 100 percent of consumer and industrial products will flow without tariffs." The Oman FTA is the fifth agreement between the United States and a Middle Eastern country, following agreements with Israel, Jordan, Morocco, and Bahrain. Senate China Tariff Bill Put on Hold Until 2007Sens. Charles Schumer (D-NY) and Lindsey Graham (R-SC) introduced legislation (S 295) that would have imposed 27.5% tariffs on all imports from China until that country revalued its currency. The currency of the People's Republic of China is artificially pegged at a level significantly below its market value - between 15% and 40% or an average of 27.5%. They had threatened to block all legislation until a vote was taken on their bill. The undervaluation of the yuan provides the People's Republic of China with a significant trade advantage by making exports less expensive for foreign consumers and by making foreign products more expensive for Chinese consumers. The result is a significant subsidization of China's exports and a virtual tariff on foreign imports. However, these two Senators towards the end of the congressional session withdrew their request for a Senate vote on their bill. They stated that it was unnecessary because they had accomplished their goal of "focusing attention on the link between trade and China's currency policies." Schumer stated that "the bottom line is that this bill was designed as a wake-up call and it has been a rousing success." Both Senators also stated that they will work with Senate Finance Committee Chairman Charles E. Grassley (R-IA) and Ranking Member Max Baucus (D-MT) to draft a new bill on China currency that will be consistent with World Trade Organization (WTO) rules and Administration policy. Grassley stated that the new legislation will send a strong signal to China concerning their currency policy and the "joint product has to be WTO-compliant [and] applicable as public policy for a long time." Quiet Diplomacy Continues in Wake of WTO Talk CollapseUnited States Trade Representative (USTR) Susan Schwab and European Trade Commissioner Peter Mandelson met and discussed the potential for narrowing differences in their respective WTO negotiating positions. However, unlike after other meetings US and EU officials declined to comment on their discussions, stating that they now prefer "quiet diplomacy to high-profile events." Schwab noted that progress has been made "out of the glare of the Geneva spotlight, where you have formal ministerials and artificial deadlines" and said that "there's great value in [bilateral and other discussions] that have been going on more quietly [than before]." Customs Will Not Distribute Byrd Monies Assessed on Canadian, Mexican GoodsThe Bureau of Customs and Border Protection (CBP) announced that it would not distribute antidumping and countervailing duties assessed on goods from Mexico and Canada to affected domestic producers. CBP made the decision in response to the US Court of International Trade's decision in Canadian Lumber Trade Alliance v. United States, which held that the Continued Dumping and Subsidy Offset Act (CDSOA, also known as the "Byrd Amendment") does not apply to imports from Canada and Mexico because to do so would violate the terms of the North America Free Trade Agreement (NAFTA). Byrd Amendment distributions for goods other than those from Canada and Mexico are not affected by that.
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