WASHINGTON (Reuters) - President Barack Obama must clarify his position on a bill before Congress aimed at forcing China to revalue the yuan, a top Republican said on Tuesday.
House of Representatives Majority Leader Eric Cantor said it was "critical" that the White House make clear its view of the bill, which the Senate was expected to pass later in the day.
"What I would like to see is where the administration is. Clearly they've got concerns as well," Cantor, the number two in the Republican-controlled House, told reporters.
Last week, House Speaker John Boehner warned that the legislation was "dangerous" and could start a trade war.
Passage of the bill would create a dilemma for Obama, whose re-election prospects next year could hinge on whether voters believe he is doing enough to create American jobs.
If he signed the bill, there could be a powerful backlash from China; if he vetoed it, he could pay a political price -- particularly in battleground industrial states like Ohio and Michigan.
The Democratically-led Senate is expected to pass the bill by a wide bipartisan margin, putting pressure on House leaders to take up the popular bill or accept blame for its demise.
Cantor's comments appeared intended to make sure the White House shares responsibility for the fate of the bill.
"I think all of us are very concerned about the competitiveness of our manufacturers in this country and the unfair practices by China and others," Cantor said.
Many economists say China holds down the value of its yuan currency to give its exporters an edge in global markets.
Some U.S. lawmakers contend the yuan is undervalued by as much as 25 percent to 40 percent, making it hard for American products to compete on price with Chinese-made goods.
A key provision of the bill would require the Commerce Department to consider whether undervalued currencies act as an effective export subsidy that justify the United States applying countervailing duties in response.
Obama, who has preferred dialogue with China to punitive measures, last week said China was "gaming" the international trade system.
But he has not taken a formal position on the bill and cautioned that it must be compatible with World Trade Organization rules. Obama has not said how the legislation might run afoul of World Trade Organization rules.
Senator Rob Portman, an Ohio Republican, told Reuters he intended to vote for the currency legislation, even though he preferred the Obama administration lead a multilateral effort to pressure China to revalue the yuan.
"I have some concerns about the legislation, which I've expressed ... But I think it's time to send a strong message," said Portman, a former top U.S. trade official whose home state is the same as Boehner's.
"This is an opportunity to raise the visibility of the issue and to encourage the administration to address it more vigorously," Portman said.
(Reporting by Richard Cowan and Doug Palmer; Editing by David Storey)