[Congressional Record Volume 170, Number 5 (Wednesday, January 10, 2024)]
[House]
[Pages H35-H37]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
CHINA EXCHANGE RATE TRANSPARENCY ACT OF 2023
Mr. McHENRY. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 839) to require the United States Executive Director at the
International Monetary Fund to advocate for increased transparency with
respect to exchange rate policies of the People's Republic of China,
and for other purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 839
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``China Exchange Rate
Transparency Act of 2023''.
SEC. 2. FINDINGS.
The Congress finds as follows:
(1) Under Article IV of the Articles of Agreement of the
International Monetary Fund (IMF), the People's Republic of
China has committed to orderly exchange rate arrangements,
the avoidance of exchange rate manipulation, and cooperation
with the IMF to ensure ``firm surveillance'' of the exchange
rate policies of the People's Republic of China. Pursuant to
Article VIII of the Articles of Agreement of the IMF, the IMF
may require the People's Republic of China to furnish data on
gold and foreign exchange holdings, including assets held by
non-official agencies of the People's Republic of China.
(2) In its November 2022 report, entitled ``Macroeconomic
and Foreign Exchange Policies of Major Trading Partners of
the United States'', the Department of the Treasury
concluded, ``China provides very limited transparency
regarding key features of its exchange rate mechanism,
including the policy objectives of its exchange rate
management regime and its activities in the offshore RMB
market.''. The Department continued: ``China's lack of
transparency and use of a wide array of tools complicate
Treasury's ability to assess the degree to which official
actions are designed to impact the exchange rate.''.
(3) In that report, the Department further noted that
``China's failure to publish foreign exchange intervention
and broader lack of transparency around key features of its
exchange rate mechanism make it an outlier among major
economies and warrants Treasury's close monitoring.''.
SEC. 3. ADVOCACY FOR INCREASED EXCHANGE RATE TRANSPARENCY
FROM CHINA.
The Secretary of the Treasury shall instruct the United
States Executive Director at the International Monetary Fund
(in this Act referred to as the ``IMF'') to use the voice and
vote of the United States to advocate for--
(1) increased transparency from the People's Republic of
China, and enhanced multilateral and bilateral surveillance
by the IMF, with respect to the exchange rate arrangements of
the People's Republic of China, including any indirect
foreign exchange market intervention through Chinese
financial institutions or state-owned enterprises;
(2) in connection with consultations with the People's
Republic of China under Article IV of the Articles of
Agreement of the IMF, the inclusion of any significant
divergences by the People's Republic of China from the
exchange rate policies of other issuers of currencies used in
determining the value of Special Drawing Rights; and
(3) during governance reviews of the IMF, stronger
consideration by IMF members and management of the
performance of China as a responsible stakeholder in the
international monetary system when evaluating quota and
voting shares at the IMF.
SEC. 4. SUNSET.
This Act shall have no force or effect on or after the date
that is 30 days after the earlier of--
(1) the date that the United States Governor of the IMF
reports to the Congress that the People's Republic of China--
(A) is in substantial compliance with obligations of the
People's Republic of China under the Articles of Agreement of
the IMF regarding orderly exchange rate arrangements; and
(B) has undertaken exchange rate policies and practices
consistent with those of other issuers of currencies used in
determining the value of Special Drawing Rights; and
(2) the date that is 7 years after the date of the
enactment of this Act.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
North Carolina (Mr. McHenry) and the gentlewoman from Ohio (Mrs.
Beatty) each will control 20 minutes.
The Chair recognizes the gentleman from North Carolina.
General Leave
Mr. McHENRY. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days in which to revise and extend their remarks
and include extraneous material on the bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from North Carolina?
There was no objection.
Mr. McHENRY. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise in support of H.R. 839, the China Exchange Rate
Transparency Act of 2023, introduced by the gentleman from Pennsylvania
(Mr. Meuser).
The China Exchange Rate Transparency Act reflects a bipartisan
objective to hold China accountable for its poor economic governance.
The International Monetary Fund's articles of agreement require
member countries to `` . . . collaborate with the Fund and other
members to assure orderly exchange arrangements and to
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promote a stable system of exchange rates.''
In other words, to remain a member of the IMF, a country should avoid
manipulating exchange rates to gain an unfair competitive advantage
over other member countries.
According to the Treasury Department's November 2022 Foreign Exchange
Report, ``China's lack of transparency and use of a wide array of tools
complicate Treasury's ability to assess the degree to which official
actions are designed to impact the exchange rate.''
This is just another barrier created by China's economic governance
that prevents us from gaining basic insights into the world's second
largest economy.
This opacity threatens the core mission of the IMF, which was
established to help monitor exchange rate agreements.
It is ironic that China is always the one who demands a greater voice
at the IMF, even if its actions undermine the fund's ability to be
effective.
For too long, we have seen China dismiss international rules of the
road. From debt restructuring in the developing world to massive
Chinese export credits, China has refused to work with other economies
to find global solutions.
Mr. Meuser's bill will help prevent China from undermining yet
another key area of cooperation--the IMF's monitoring of exchange
rates.
It will require the Treasury Department to push for greater
transparency in China's exchange rate management during the IMF's
economic reviews of China.
The bill would also make future reviews of Chinese shareholding in
the IMF contingent on Beijing becoming a more responsible player in the
international monetary system.
We need Treasury to take a firm stand at the IMF and insist that
China adhere to the exchange rate policies of other advanced economies,
or at the very least, disclose what those policies are.
This is important for the global economy, and it is certainly
important for the American economy and American workers.
I thank Mr. Meuser for his leadership on this bill and urge my
colleagues to support it, and I reserve the balance of my time.
Mrs. BEATTY. Madam Speaker, I yield myself such time as I may
consume.
Madam Speaker, I rise in support of H.R. 839, the China Exchange Rate
Transparency Act of 2023, sponsored by Congressman Meuser.
This bill requires the United States executive director at the
International Monetary Fund, or IMF, to use its voice and vote to
advocate for increased transparency regarding China's exchange rate
policies.
This is important because China has a history of devaluing its
currency, the yuan, against the dollar, making its exports unfairly
cheaper, and thereby harming small businesses in the United States.
This bill would further impose greater accountability on China by
requiring the United States to press the IMF to report whether China's
exchange rate policies affect the value of SDRs and to consider China's
performance as a responsible partner in the international monetary
system when evaluating China's voting power at the IMF.
President Biden's Treasury Department has already increased
transparency of China's practices, including by placing it on a watch
list for its failure to publish foreign exchange intervention and key
features of its exchange rate setting mechanism.
This bill would reinforce the Biden administration's actions to
further push for greater transparency and accountability in this
regard.
These are sensible actions Congress can take to prevent China from
using its currency as an economic weapon.
For these reasons, I urge my colleagues to support this bill, and I
reserve the balance of my time.
Mr. McHENRY. Madam Speaker, I yield 4 minutes to the gentleman from
Pennsylvania (Mr. Meuser) to explain his bill.
Mr. MEUSER. Madam Speaker, I thank Chairman McHenry very, very much.
I appreciate his leadership on our committee and on this bill.
I do rise in support of my legislation, the China Exchange Rate
Transparency Act, H.R. 839, a bipartisan initiative supported by
Representatives Donalds, Loudermilk, Nickel, Lawler, Lee of Nevada, and
De La Cruz.
This legislation confronts the People's Republic of China's often
deceptive and autocratic exchange rate policies and regular disregard
for financial transparency on the international stage.
With this legislation, we are directing and challenging China's
opaque and often manipulative practices in foreign exchange markets,
including their policy of accumulating massive foreign currency
reserves and depreciating their currency, which undercuts the
competitiveness of U.S. exports. By mandating the U.S. executive
director at the IMF to use the voice and vote of the United States to
advocate for increased exchange rate transparency from China, we are
not just advocating for fairness--we are fighting for the integrity of
the global economy.
The Department of Treasury's reports from November 2022 to 2023 lay
it out clearly: China's exchange rate practices are too often shrouded
in secrecy, undermining not just the U.S. but the entire global trade
system. It is time we confront China's persistent gaming of
international norms. They have been playing by their own rules for too
long, and it is detrimental to global economic fairness and stability.
This legislation is not about only singling out China. It is about
ensuring that all IMF members, including China, adhere to the rules
that they have agreed to. China has promised to maintain orderly
exchange rate arrangements without manipulation. It is our job to hold
them to that promise and to ensure they do not continue to exploit the
system to their advantage.
We are taking a firm, no-nonsense approach to a complex issue,
emphasizing our commitment to fair trade and a transparent global
economic system.
I strongly urge my colleagues to support the China Exchange Rate
Transparency Act of 2023, H.R. 839. This legislation stands for
accountability in international finance, fair trade practices, and the
stability of our global economy.
Mrs. BEATTY. Madam Speaker, I yield myself the balance of my time.
Madam Speaker, this legislation builds upon the Biden
administration's efforts to increase transparency and accountability of
China on key features of how it sets its currency exchange rate.
It is critical to continue to apply pressure on China in this regard
because weaponizing its exchange rate will directly harm the United
States' small businesses selling their products and services here in
the United States.
For these reasons, I again urge my colleagues to support this bill,
and I yield back the balance of my time.
{time} 1515
Mr. McHENRY. Madam Speaker, I yield myself the balance of my time.
I reiterate that Mr. Meuser's bill will help prevent China from
undermining yet another key area of cooperation; and that is the IMF's
monitoring of exchange rates.
Exchange rates affect the cost of goods and services in every
district in America. Whether or not China is adhering to international
norms affects our economy, it affects the global economy, and we need
to address that.
We have legislation that enables us to address that. It enables us to
speak in a bipartisan way that China's currency manipulation we will
not stand for as a statement of American policy.
This bill will require the Department of the Treasury to push for
greater transparency in China's exchange rate management during the
IMF's economic reviews of China. That is the way we are going to do it.
We have sound policy. I urge my colleagues to support it, and I thank
my Democratic colleagues and Republican colleagues on committee for
working together on this bill, as well as Mr. Meuser of Pennsylvania
for his leadership on this important issue.
Madam Speaker, I urge adoption of this bill, and I yield back the
balance of my time.
The SPEAKER pro tempore (Ms. Van Duyne). The question is on the
motion offered by the gentleman from North Carolina (Mr. McHenry) that
the House suspend the rules and pass the bill, H.R. 839, as amended.
[[Page H37]]
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds
being in the affirmative, the ayes have it.
Mr. McHENRY. Madam Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further
proceedings on this motion will be postponed.
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