China says not seeking substantial trade surplus with U.S.

16:48, May 06, 2011      

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China reaffirmed on Friday that it is not looking at pursuing a substantial trade surplus with the United States.

"China's policy is clear-cut: we are not seeking a large trade surplus," Vice Finance Minister Zhu Guangyao said during a press briefing on Friday, days ahead of the China-U.S. Strategic and Economic Dialogue, which will take place in Washington next week.

Zhu said that the Chinese market is open to the United States, with U.S. shares increasingly soaring. "We have a mutually beneficial, win-win economic relationship," Zhu said.

China is the United States' second-largest trading partner and its third-largest export market, with bilateral trade totalling about 385 billion U.S. dollars in 2010, according to Chinese customs statistics.

In regard to Chinese currency reforms, Zhu said the exchange rate issue is a matter of China's own economic sovereignty.

He said China and the United States agreed on the direction for yuan reform but remain divided on the specifics.

"China believes the objective is to deepen exchange rate reforms, while the United States is focused on the range of the yuan's appreciation," Zhu said.

However, Zhu said that U.S. Treasury Secretary Timothy Geithner acknowledged that the yuan exchange rate is floating.

Zhu said both sides have maintained smooth communication on the issue and their differences concerning the range of the yuan's appreciation require further understanding.

Geithner said on Tuesday that Beijing has allowed the yuan to rise in value by about 5 percent against the dollar since last June.

In regard to managing China's growing foreign exchange holdings, Zhu said it was a "crucial and challenging" job.

"The principle is to ensure safety, liquidity and moderate profitability," he said.

Source: Xinhua
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