Committee, Administration Likeminded on PNTR for China

May 17, 2000

At a hearing today of the House Committee on Agriculture, high level representatives from the Clinton Administration and farm groups testified while Members of the Committee expressed overwhelming support for Permanent Normal Trade Relations (PNTR) with China.

"China represents an agriculture market that is vital to the long-term success of American farmers and ranchers," Committee Chairman Larry Combest (R-TX).  "Agriculture trade with China can strengthen development of private enterprise in that country and bring China more fully into world trade membership."

For American farmers and ranchers, trade is an essential part of their livelihoods. Currently exports account for 30% of U.S. farm cash receipts and nearly 40% of all agricultural production is exported.  Last year, U.S. agricultural exports to China amounted to $2.2 billion with a $1.4 billion surplus.  With PNTR, agricultural trade is expected to increase by as much as $2 billion annually by 2005.

"One of the arguments currently being made against PNTR for China is the idea that China, with its 1.3 billion citizens and only 7% of the world's arable land doesn't need U.S. agricultural products," said Ranking Committee Member Charlie Stenholm (D-TX).  "USDA's Economic Research Service (ERS) has indicated that China will continue to be a major market for U.S. Agricultural products.  In fact, the ERS has concluded that China's implementation of its WTO obligations between 2000 and 2004 will add $1.7 billion to the bottom line for US farmers and ranchers in 2005."

This agreement means that Chinese tariffs will be reduced for beef, pork, wheat and other commodities.  Improved access will be provided for cotton, corn, rice and soybeans through reform of the Chinese tariff-rate quota system.  China has also agreed to eliminate its export subsidies and to reduce trade distorting domestic subsidies, upon accession to the WTO.

"This agreement is good for U.S. agriculture," Combest said.  "But in order to make sure that our farmers and ranchers benefit from the agreement we must act to provide permanent normal trade relations for China."

More than 80 agricultural organizations representing producers, processors, and exporters support this agreement and permanent extension of normal trade relations with China.  Eight former Secretaries of Agriculture support granting permanent normal trade relations for China.  Former Presidents Bush, Carter and Ford support this effort