Metals - Mining

“We commend Rep. Ryan and Rep. Hunter for their initiative on the Chinese currency situation,” said William E. Gaskin, President of the Precision Metalforming Association, a member of MMC. “Manufacturers—especially small and medium-sized businesses—are losing jobs and business because of China’s currency manipulation.”

He continued, “We also thank the 105 Republicans and Democrats who have signed on to support the bill. Domestic manufacturers should be afforded all means available under international agreements to force China to live up to its obligations. We believe that the China Currency Act of 2005 is an appropriate and reasonable step to expedite a realistic solution to the issue of currency manipulation.”

In a June 30th press release, Congressman Ryan said, "I am extremely pleased with the support our bill has received. This should be a clear warning to the Chinese government and, frankly, to our own administration, that Congress is serious about fixing this problem."

Added Congressman Hunter, "China has freely manipulated and undervalued its currency for far too long. Congress needs to address this issue and take the action necessary to ensure the vitality of our nation's economy and manufacturing base.”

Since 1994, China has illegally manipulated its currency to gain an unfair advantage over American manufacturers. By regulating its currency rate at approximately 8.28 yuan to every U.S. dollar, Chinese manufacturers are able to produce relatively inexpensive products in comparison to U.S. exports.

The undervaluation of the yuan is partly responsible for the loss of approximately 1.5 million jobs to China between 1989 and 2003, as well as the record $162 billion U.S. trade deficit with China last year. Economists estimate that China’s currency manipulation has resulted in substantial undervaluation of the yuan, perhaps by 40 percent or more. Evidence of this undervaluation can be found in the large and growing annual trade surpluses of the People's Republic of China, foreign-direct investment in China, and rapidly increasing aggregate amount of foreign-currency reserves.

In a June 22nd letter to Reps. Ryan and Hunter, MMC members wrote, “Our companies are convinced that we can compete against the low-wage countries because of our entrepreneurship, innovation and skills. However, the playing field is severely slanted in favor of the currency manipulating countries. Given the length of supply lines and U.S. excellence, our companies welcome the opportunity to compete for business given a fair chance that would be provided by the legislation you have introduced.”

The Metalworking Manufacturing Coalition (MMC) is a coalition of 11 manufacturing trade associations, and represents more than 10,000 individual manufacturing companies with more than 500,000 employees. Members include the American Foundry Society, Forging Industry Association, Industrial Fasteners Institute, Metals Service Center Institute, National Tooling & Machine Assoc., Non-Ferrous Founders’ Society, Precision Machine Products Association, Precision Metalforming Association, Spring Manufacturers Institute, Steel Founders’ Society of America, and Tooling & Manufacturing Association.

For more information please contact Dara Klatt at (202) 466-6210 or dara.klatt@pbnco.com