On October 11, 2011, the U.S. Senate passed S.1619, the Currency Exchange Rate Oversight Reform Act of 2011, otherwise known as the “China Currency Legislation” because it would crack down on China and other countries for currency manipulation with tariffs. Given the politics of the election year, it currently seems unlikely that the legislation will make it to President Obama’s desk for a signature. However, the legislation is likely to remain under debate. Republican Presidential nominee hopeful Mitt Romney has said he would take action against China on his first day in office.
On March 19, 2013, U.S. Representatives Tim Ryan (D-OH), Sander Levin (D-MI), Tim Murphy (R-PA), and Mo Brooks (R-AL) introduced the Currency Reform for Fair Trade Act of 2013, which would clarify that countervailing duties may be imposed to address subsidies relating to a fundamentally undervalued currency of any foreign country, namely China. This appears to be the same legislation from the 112th Congress.
The United States Fashion Industry Association (USFIA) was opposed to the passage of the Currency Exchange Rate Oversight Reform Act of 2011 because it would be counterproductive to U.S. goals related to Chinese currency and would do more harm than good to job creation and economic growth in the United States.
USFIA has been actively involved with the U.S.-China Business Council, which represents American companies that do business with China and seeks to expand the U.S.-China business relationship to the benefit of both member companies as well as the wider U.S. economy. The Council’s vice president, Erin Ennis, spoke at the 2011 Annual Textile & Apparel Importer Trade & Transportation Conference about the U.S.-China relationship and, specifically, the China Currency Legislation under consideration in Congress.
On June 24, 2011, USFIA (formerly USA-ITA) joined the U.S.-China Business Council and the China Business Coalition in sending a letter to House and Senate leadership noting that the legislation could cause China to retaliate against U.S. exports and may be in violation of the World Trade Organization standards. Instead, we support a bilateral and multilateral approach to working with China.