Commerce minister irate over yuan issue
Source: Agencies/Shanghai Daily |
March 22, 2010, Monday
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Print Edition
Print Edition
THE Chinese commerce minister warned the United States yesterday against declaring China a currency manipulator and imposing trade sanctions and said his country was likely to report a trade deficit in March.
Chen Deming again accused Washington of politicizing the currency issue ahead of an April 15 deadline for the United States Treasury to rule whether China is "unfairly" holding down its exchange rate to gain a competitive edge in global markets.
If the US declared China a currency manipulator, Chen said the nation would not sit idly by and reiterated Premier Wen Jiabao's statement a week ago denying that the yuan was undervalued.
"We think the renminbi is not undervalued, but if the US Treasury gives an untrue reply for its own needs ... well, we will wait and see," Chen told the China Development Forum in Beijing.
He said if trade sanctions followed, China would "not do nothing."
"We will also respond if this means litigation under the global legal framework," Chen said.
He did not specify how China might respond.
Political pressure is growing in Washington to declare China a currency manipulator.
Some US senators are threatening to slap a range of duties on Chinese products if China does not make moves to appreciate the yuan.
Chen dismissed charges that exchange-rate controls are the cause of the surplus, blaming instead US restrictions on exports of certain goods to China, such as high-tech items that could have both civilian and military use.
Chen also said the US had politicized the currency dispute and exaggerated the level of the trade surplus between the two countries.
"Both in theory and in practice, the appreciation of a country's currency has a very limited role in adjusting trade," Chen said.
He noted that despite the yuan appreciating by more than 20 percent from 2005 to 2008, China's trade surplus increased in this period.
By contrast, as China had kept the yuan stable since 2009, the trade surplus fell more than 30 percent last year from 2008, and continued to decline another 50 percent year on year in the first two months this year, he said.
"Personally I think China is likely to see trade deficit in March," Chen said.
Chen said the exchange rate issue was something entirely within China's sovereign rights instead of a matter to be discussed between two nations.
He called on all countries to oppose any form of trade protectionism.
Vice Finance Minister Wang Jun, also speaking at the forum, said it was not time yet to talk about exiting the economic stimulus program.
Chen Deming again accused Washington of politicizing the currency issue ahead of an April 15 deadline for the United States Treasury to rule whether China is "unfairly" holding down its exchange rate to gain a competitive edge in global markets.
If the US declared China a currency manipulator, Chen said the nation would not sit idly by and reiterated Premier Wen Jiabao's statement a week ago denying that the yuan was undervalued.
"We think the renminbi is not undervalued, but if the US Treasury gives an untrue reply for its own needs ... well, we will wait and see," Chen told the China Development Forum in Beijing.
He said if trade sanctions followed, China would "not do nothing."
"We will also respond if this means litigation under the global legal framework," Chen said.
He did not specify how China might respond.
Political pressure is growing in Washington to declare China a currency manipulator.
Some US senators are threatening to slap a range of duties on Chinese products if China does not make moves to appreciate the yuan.
Chen dismissed charges that exchange-rate controls are the cause of the surplus, blaming instead US restrictions on exports of certain goods to China, such as high-tech items that could have both civilian and military use.
Chen also said the US had politicized the currency dispute and exaggerated the level of the trade surplus between the two countries.
"Both in theory and in practice, the appreciation of a country's currency has a very limited role in adjusting trade," Chen said.
He noted that despite the yuan appreciating by more than 20 percent from 2005 to 2008, China's trade surplus increased in this period.
By contrast, as China had kept the yuan stable since 2009, the trade surplus fell more than 30 percent last year from 2008, and continued to decline another 50 percent year on year in the first two months this year, he said.
"Personally I think China is likely to see trade deficit in March," Chen said.
Chen said the exchange rate issue was something entirely within China's sovereign rights instead of a matter to be discussed between two nations.
He called on all countries to oppose any form of trade protectionism.
Vice Finance Minister Wang Jun, also speaking at the forum, said it was not time yet to talk about exiting the economic stimulus program.
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