Brady Says USTR Should Use TFTEA Definition of Currency Manipulation for Vietnam Investigation
Former House Ways and Means Committee Chairman Kevin Brady, R-Texas, told reporters that as the Office of the U.S. Trade Representative considers whether Vietnam should be punished for currency manipulation (see 2010050036), he should rely on a “bipartisan definition of currency manipulation” described in the Trade Facilitation and Trade Enforcement Act (TFTEA). Brady, who was speaking to reporters on a teleconference Oct. 7, noted that TFTEA was one of the first bills he shepherded through the committee when he took the gavel.
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Currency manipulation can be found if Vietnam has a significant trade surplus and a material current account surplus, and has engaged in persistent intervention in currency markets, TFTEA says. The law also says the U.S. should discuss the manipulation with the problem country before retaliating, but says that if the country doesn't stop, the president must retaliate. The law does not suggest tariffs on imports as a retaliation, but does say that a future free trade agreement should take the issue into consideration. Vietnam is one of the parties to the Trans-Pacific Partnership, which the administration withdrew from.
Brady said that if USTR uses that definition, it would ensure that whatever actions are taken after the Section 301 investigation is complete are valid.