China rejects Obama pressure over currency

A bank clerk transfers stacks of renminbi in a bank in Hefei in central China's Anhui province. File photo: AP.

A bank clerk transfers stacks of renminbi in a bank in Hefei in central China's Anhui province. File photo: AP.  

China lashed back on Thursday at President Barack Obama’s vow to get tougher in currency disputes, saying criticism is unhelpful and insisting exchange controls are not to blame for its trade surplus.

Mr. Obama’s comments on Wednesday could add to strains with Beijing amid tensions over U.S. arms sales to Taiwan, Internet censorship and a possible Obama meeting with the Dalai Lama.

“The exchange rate of the renminbi is not the major reason for the Chinese-U.S. trade deficit,” Foreign Ministry spokesman Ma Zhaoxu said, referring to the currency, which is also known as the yuan.

Washington and other Chinese trading partners say the yuan is kept undervalued, giving China’s exporters an unfair price advantage and swelling its trade surplus.

“We hope the U.S. side could objectively and rationally see a number of problems in the Chinese-U.S. economic and trade cooperation and appropriately deal with them via negotiation,” Mr. Ma said at a regular news briefing. “Criticism and pressing obviously is not helpful to solving problems.”

China reported a $196 billion global trade surplus last year.

At a meeting with U.S. senators in Washington on Wednesday, Mr. Obama said his administration would take a tougher line with Beijing over trade.

“The approach that we’re taking is to try to get much tougher about enforcement of existing rules, putting constant pressure on China and other countries to open up their markets in reciprocal ways,” Mr. Obama said.

“One of the challenges that we’ve got to address internationally is currency rates and how they match up to make sure that our goods are not artificially inflated in price and their goods are artificially deflated in price. That puts us at a huge competitive disadvantage,” he said.

Beijing broke the yuan’s link to the U.S. dollar in 2005 and allowed it to rise by about 20 percent through late 2008. But it has been frozen since then in what economists say is an effort by Beijing to keep its exporters competitive as global demand plunged.

Washington and Beijing also are embroiled in disputes over access to each other’s markets for tires, steel and other goods.

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Printable version | Feb 19, 2020 3:51:22 AM |

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