The move, which AAM endorses, would upend relatively low tariff rates for China and likely subject its trade status to annual reviews.
The Republicans in 2025 will control the House, Senate and the White House. And, unless the minority Democrats come around on helping the professional wrestling executive dismantle the Department of Education or the Oprah doctor slash Medicare and Medicaid budgets, there will be few opportunities for bipartisan agreement on big policy proposals.
China trade policy could be one of those opportunities. The U.S.-China Economic and Security Review Commission (USCC), an independent arm of Congress, has released its annual report on U.S.-China trade, and it contains a first: It unanimously endorses revoking permanent normalized trade relations (PNTR) status that Washington grants Beijing.
From the USCC recommendations:
The PNTR status allows China to benefit from the same trade terms as U.S. allies, despite engaging in practices such as intellectual property theft and market manipulation. Repealing PNTR could reintroduce annual reviews of China’s trade practices, giving the United States more leverage to address unfair trade behaviors. This move would signal a shift toward a more assertive trade policy aimed at protecting U.S. industries and workers from economic coercion.
This would be a big deal. China’s PNTR status was established as part of its entry into the World Trade Organization in 2001, making it the “cornerstone of U.S.-China trade policy” since then, notes the Washington Post:
President-elect Donald Trump has already pledged to raise tariffs on Chinese goods by 60 percent — congressional approval to revoke China’s preferred trade status would be one avenue to make that happen. Before PNTR status was established, enshrining limits on tariffs under U.S. law, China faced much higher rates that were subject to annual congressional review.
Such a move could put China in the same trade bracket as Cuba, North Korea, Russia and Belarus.
The Alliance for American Manufacturing, citing decades of unfair trade practices employed by China, has been suggesting this step for some time. Here’s what AAM President Scott Paul told the House China committee in its inaugural hearing last February:
The (Chinese Communist Party) has ramped up industrial subsidies, strengthened its (state-owned enterprises), continued a genocide of ethnic minorities, sided with Vladimir Putin, broken its promises on Hong Kong, and become more aggressive in the South China Sea and in its threatening posture towards Taiwan. Despite its empty promises, Beijing continues these egregious activities to the detriment of human rights, U.S. companies and American workers. The CCP doesn’t deserve the same trade status as allies such as Taiwan, Norway, or the United Kingdom.
Republicans and Democrats on that committee came very close to fully endorsing that idea last year, basically calling for China PNTR to be renegotiated. And the chair of the China committee, Rep. John Moolenaar (R-MI), has recently introduced legislation to revoke it entirely.
As a new Congress begins with margins tight enough to make partisan legislating less than easy, legislation to reshape the contours of the China trade relationship – like revoking PNTR – would likely draw bipartisan support. It’s worth keeping an eye on it.