WASHINGTON (Reuters) - U.S. lawmakers are preparing a new push to stop trading partners unfairly manipulating their currencies to gain an export advantage, a senior Democrat said on Thursday.
Michigan Senator Debbie Stabenow said she was working with colleagues from both parties on a possible standalone bill to stop currency cheats and also aimed to ensure that an ambitious Pacific trade pact includes strict currency rules.
“We are talking about the right time to introduce a bill,” Stabenow said in an interview with Reuters. “Our message is that we should not agree to any trade agreement that does not have strong currency enforcement.”
The planned push is a further complication for U.S. officials already fighting opposition to fast-tracking trade deals through Congress and worries about the Trans-Pacific Partnership (TPP).
The TPP deal covers 12 countries representing 40 percent of the world economy, including Japan, whose yen currency has weakened due to the country’s economic stimulus measures.
Fresh demands from Congress would come at a delicate time for the TPP, which officials hope to wrap up within months after nearly five years of discussions.
But U.S. auto makers fear increased competition from Japan, and the American Automotive Policy Council, which represents Chrysler, Ford and General Motors - all based in Michigan - has said it will oppose a deal without strong currency rules.
Democrat Sherrod Brown, who has introduced similar legislation in the past, is coordinating bipartisan work on a bill in the Senate and House lawmakers have also been consulted.
Brown has championed U.S. steel producers such as Nucor Corporation and AK Steel Corporation in trade cases against China, which companies also accuse of currency manipulation.
Republican Pat Tiberi, who chairs the trade subcommittee of the House Committee on Ways and Means, said the possibility of a separate bill was still under discussion but the issue had traction from both parties.
More than half the lawmakers in the last Congress signed letters calling for tough TPP currency provisions, including 199 current House members and 50 current Senators.
“I think there’s bipartisan concern about currency manipulation,” Tiberi said, although one had to balance the risk that including such rules would upset TPP partners.
A Mexican official familiar with the negotiations said it looked too late to include a currency measure in the pact.
But another senior TPP country official said a currency clause might be acceptable if it mimicked existing international covenants, like International Monetary Fund rules committing countries to eschew currency manipulation for competitive advantage.
“If it is just going be a copy-paste of something else it’s less serious,” he said.
Stabenow said lawmakers were still working out how best to push the issue in Congress, including the option of amending planned fast-track legislation, which allows Congress to set negotiating goals in exchange for a yes-or-no vote.
“The push regarding Japan is to make this one of the criteria in the trade agreement and the broader issue is that we would be doing something legislatively that would more broadly impact China and other countries,” she said.
Reporting by Krista Hughes; Editing by Sandra Maler, Leslie Adler and Alan Crosby