Sino-US tensions show no sign of easing

08:19, March 26, 2010      

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There are no clear signals of an easing in trade and political tensions in Sino-US relations despite the hope generated by the visits of two Chinese vice-ministers to Washington.

Vice-Commerce Minister Zhong Shan said in the US capital on Wednesday that Beijing will reform its currency regime gradually and keep the exchange rate stable.

Rejecting mounting US calls to allow the yuan to rise more quickly, Zhong said changing the exchange rate was not the way to fix a huge bilateral trade gap, and that it could upset the global economy.

"Revaluing the renminbi is not a good recipe for resolving problems," he told the US Chamber of Commerce.

"It is in nobody's interest - China's, the US' or other countries' - to see big ups in the renminbi or big downs in the dollar," Zhong said.

He asked Washington not to blame others for its own problems, "otherwise, the outcome would just be the opposite".

Zhu Min, deputy governor of the People's Bank of China, the central bank, also said on Thursday that Beijing will refine its exchange rate regime but declined to set a timetable.

US Treasury Secretary Timothy Geithner said it was critical for China to allow its currency to rise.

"We can't force them to make that change," he said in an interview with CNN. "But it is very important that they let it start to appreciate again. And I think many of them understand that," he said.

US Senators are crafting a law that would slap import duties on Chinese goods to offset what they believe is the low value of its currency.

The sponsors of the bill, Democratic Senator Charles Schumer and Republican Senator Lindsey Graham, also want the Barack Obama administration to formally label China a currency manipulator in a semi-annual Treasury Department report due on April 15.

Referring to Vice-Foreign Minister Cui Tiankai, who was on a transit visit in Washington earlier this week, the Foreign Ministry said on its website that he received promises from high-level US officials that Washington "attaches great importance to China's stance and concerns on issues related to Taiwan and Tibet" and would "cautiously handle the sensitive issues".

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