WASHINGTON, Feb. 16, 2017 – A diverse group of panelists at a Washington International Trade Association (WITA) event today agreed with popular criticism that the U.S.-China trade relationship is unbalanced, but mostly agreed that the Trump administration should tread lightly in demanding reforms.
“My one advice would be the Goldilocks strategy,” said Robert Atkinson, president of the Information Technology and Innovation Foundation. “Frankly, in my view, we’ve been way too soft on China. If you tilt to the exact opposite, it’s not going to work. You cannot alienate them so badly that they just dig in and do nothing, but short of doing what we’re doing (now), which is to plead with them, I don’t think that’s working either.”
Darci Vetter, former chief agricultural negotiator for the U.S. Trade Representative in the Obama administration, agreed that China needs to change the way that it does some things, but stressed that American farmers depend heavily on keeping trade flowing.
“If you think about fiber, the textile industry in China really drives global cotton markets,” she said at the WITA forum. “Just a hint of what they might do with their cotton reserves creates global volatility in cotton prices. We export over 80 percent of the cotton we grow. The same is true for protein. China’s eating more beef, pork, poultry and dairy. We’re key exporters of those products as well. The biggest market for our nuts and dried fruit is China. All of our agricultural regions across this country … need that key customer.”
But the U.S. also needs China to make big changes, such as reforming the opaque and delayed process it uses to approve new genetically modified traits, said Joseph Damond, a senior vice president for the Biotechnology Industry Organization and another speaker at the event.
Vetter took the biotech criticism further, suggesting that China used its regulatory barriers to directly curtail imports and manage supplies in the country.
When China needed corn, U.S. exports were welcomed, she stressed, but when domestic supplies – spurred on by subsidies – created a glut, China used biotechnology regulations as a tool to shut the U.S. out.
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Vetter was describing the period in 2013 when China claimed it found traces of Syngenta's Viptera corn -- a biotech trait that had been approved in the U.S. and elsewhere, but not China. Over the next two years China rejected about 2 million tons of U.S. corn after alleging it found minute levels of Viptera.
“I don’t necessarily see that changing anytime soon, but we can help and engage with them to make that less frequent, work with others to increase pressure on (China) to be more transparent, consistent and open about what those policies are,” she said.
But China needs our exports as much as we need to sell them, Vetter said, and that gives us leverage to encourage reform.
“China also needs us,” she said. “They are not in a position where they’re going to be self-sufficient. While they have generally stated that as a goal, they know that imports are a key part of achieving food security for them … And there are a billion-plus people in China who need to eat.”