June 22, 2007
News Release 07-064
Inv. No. 332-492
Contact: Peg O'Laughlin, 202-205-1819

ITC TO MODIFY, AUGMENT SERIES OF REPORTS ON CHINA

The U.S. International Trade Commission (ITC or Commission) today announced that it will modify and augment its series of reports on U.S.-China trade, as requested by the U.S. House of Representatives' Committee on Ways and Means.

The ITC, an independent, nonpartisan, factfinding federal agency, was originally asked by the Committee to complete a three-report series that collectively would provide an in-depth assessment of the U.S.-China trade and investment relationship and the U.S.-Asia-Pacific trade and investment relationship. In a letter received on May 29, 2007, the Committee asked the Commission to add additional components to the investigation in order to provide an in-depth assessment of the causes of the U.S.-China trade imbalance and whether and to what extent the People's Republic of China uses various forms of government intervention to promote investment, employment, and exports. The Committee noted it may supplement its request further, including with questions related to the functioning of China's labor market.

The ITC will revise its approach and timelines for the three studies to accommodate the Committee's request.

The first report, to be delivered no later than seven months from the receipt of the Committee's latest letter, will describe Chinese government practices and policies that support and attempt to influence decision making in China's agricultural, manufacturing and services sectors and by individual firms. The second report, to be delivered within 14 months, will build on the first by comprehensively cataloguing and, where possible, quantifying the government policies and interventions described in the first study in specific sectors. The third report, to be delivered within 24 months, will combine two of the initially requested studies that describe changes in U.S.-Asia trade and assess how two global trends the fragmentation of production processes and the growth in foreign direct investment flows contribute to the growth in the U.S. trade deficit with China. Details about the second two reports will be announced when those reports are initiated.

The first report, China: Description of Selected Government Practices and Policies Affecting Decision-Making in the Economy, will describe and, where possible, quantify the practices and policies that central, provincial, and local government bodies in China use to support and attempt to influence decision making in China's agricultural, manufacturing, and services sectors and by individual firms.

The ITC report will include chapters describing government policies related to the privatization of state-owned enterprises and private ownership; price coordination; industrial development, particularly policies that target specific industries; the banking and finance sectors, including policies and interventions to promote indicative lending and on the treatment of nonperforming loans; utility rates; infrastructure development; taxation; restraints on imports and exports; research and development; worker training and retraining; and the rationalization and closure of uneconomic enterprises. As requested, the Commission also will include an analysis of the impact of a recent policy directive from China's State-Owned Assets Supervision and Administration Commission.

The ITC will hold a public hearing in connection with the investigation at 9:30 a.m. on September 6, 2007. Requests to appear at the public hearing should be filed with the Secretary, United States International Trade Commission, 500 E Street SW, Washington, DC 20436, and must be received no later than 5:15 p.m. on August 17, 2007.

The ITC also welcomes written submissions for the record. Written submissions (one original and 14 copies) should be addressed to the Secretary, U.S. International Trade Commission, at the above address and should be filed at the earliest practical date, but no later than 5:15 p.m. on September 20, 2007. All written submissions, except for confidential business information, will be available for public inspection.

Further information on the scope of this investigation and appropriate submissions is available in the ITC's notice of investigation, dated June 21, 2007, which may be obtained from the ITC Internet site (www.usitc.gov) or by contacting the Office of the Secretary at 202-205-2000.

ITC general factfinding investigations, such as this one, cover matters related to tariffs or trade and are generally conducted at the request of the U.S. Trade Representative, the Senate Committee on Finance, or the House Committee on Ways and Means. The resulting reports convey the Commission's objective findings and independent analyses on the subject investigated. The Commission makes no recommendations on policy or other matters in its general factfinding reports. Upon completion of each investigation, the ITC submits its findings and analyses to the requester. General factfinding investigations reports are subsequently released to the public, unless they are classified by the requester for national security reasons.

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