Chris Lee on Free Trade

Tariffs against countries undervaluing their currency.

Amends the Tariff Act of 1930 to require the administering authority to determine, based on certain requirements, whether the exchange rate of the currency of an exporting country is undervalued or overvalued (misaligned) against the U.S. dollar for an 18-month period; and to take certain actions under a countervailing duty or antidumping duty proceeding to offset such misalignment in cases of an affirmative determination. Congress makes the following findings:
1. The strength, vitality, and stability of the US economy and the openness and effectiveness of the global trading system are critically dependent upon an international monetary regime of orderly and flexible exchange rates.
2. Increasingly in recent years, a number of foreign governments have undervalued their currencies by means of protracted, large-scale intervention in foreign exchange markets, and this fundamental misalignment has substantially contributed to distortions in trade flows.
3. This exchange depreciation serves as a subsidy for, and facilitates dumping of, exports from countries that engage in this mercantilist practice.
4. It is consistent with the agreements of the World Trade Organization and the International Monetary Fund that US trade law make explicit that fundamental undervaluation by an exporting country of its currency is actionable as a countervailable export subsidy and alternatively can be offset by antidumping duties.