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China calls President Obama to block 'harmful' currency bill

(Shanghai Daily)

08:05, October 13, 2011

China has urged the Obama administration to block a controversial currency bill aimed at putting pressure on the country to appreciate the yuan.

The bill is a protectionist step that "gravely violates World Trade Organization rules," Foreign Ministry spokesman Ma Zhaoxu said yesterday after the US Senate approved it in a 63-35 vote and sent it to House of Representatives.

Ma said the move was "harmful and unbeneficial."

"China calls on the US government, Congress and various communities to firmly oppose the wrongdoings of pressuring the yuan exchange rate by US legislation," Ma said. "We should resist protectionism, resist politicization of economic and trade issues, and safeguard the healthy development of Sino-US relations."

The legislation will "disrupt the shared efforts of China and the United States, as well as the international community, to promote vigorous recovery and growth in the global economy," said Ma.

A Ministry of Commerce spokesman said the bill sent a "false signal of escalating trade protectionism" that threatened global economic recovery.

In a written statement, Shen Danyang added: "It severely violates the international rule, putting a stable Sino-US economic and financial relationship at risk while running against the global efforts of fighting against protectionism."

The Currency Exchange Rate Oversight Reform Act passed by the Senate would, if it became law, allow the US to raise tariffs on Chinese imports it says are unfairly cheap due to an undervalued yuan.

Tan Yaling, president of the China Forex Investment Research Institute, said the bill was unreasonable as the US had adopted a wrong criteria to judge China, which remained a developing country with a currency that is not fully convertible.

"A sharply rising yuan will be very dangerous. It will do harm to the already shaky global economic recovery while doing nothing good on the reduction of US joblessness," Tan said. "The US should realize that China is a partner, not a rival, in terms of bilateral trade. Otherwise, it will be a lose-lose situation and both countries will get hurt."

However, the bill is unlikely to become law as it lacks the support of the majority Republican leadership in the House. And the White House and President Barack Obama, although not coming out against the bill, have shown they are uncomfortable with it, according to the Associated Press.

Dan Steinbock, research director of international business at the India, China and America Institute, an independent think tank based in the US, said the bill would face overwhelming hurdles before it could become law.

"Backing for the bill comes from the pressure of political positioning for the 2012 presidential election," Steinbock said in a recent article. "After all, the House of Representatives is wary of unilateral sanctions against China, and shows little interest in bringing the bill to a vote."

Huang Yiping, an economist at Barclays Capital, also believes that the bill will not become policy given it still needs to be passed by the House and signed by the president.

"But the Senate's passage is already sufficient to sour the atmosphere for bilateral cooperation at a time when it is most needed to maintain global growth and stability," Huang said.

The America Chamber of Commerce in China has also criticized the bill as a threat to trade and financial relations.


Leave your comment9 comments

  1. Name

PD User at 2011-10-15139.168.38.*
@PD User
China is not an enemy of the U.S.A. The U.S is generally against any nation that wants to invade and subjugate a peaceful island, demands an entire sea. China is fine!
PD User at 2011-10-14183.39.25.*
Mind you, China has always been perceived as enemy of the USA (* not necessarily the people of the USA *) so that it and its war departments can spread more dirty propaganda against China in the South China Sea region for the sake of arms sales to their corrupt faithfuls of the region! Let the "Occupy Wall Street" folks to decide the fakes of the USA and President Obama, as it concerns about losses of jobs and homes as well as unfair deals while this fabricated "congressional currency bill" may be the spark needing to blow apart the USA. Oh kid, this is not about China controlling the USA!!!
Asian Observer at 2011-10-14220.255.2.*
First, China's foreign ministry strongly protested on Obama's arms sales to Taiwan, now begs Obama to block the currency bill. What a laughing stock it has portrayed itself to be, so China is indeed a paper tiger after all. Even minnows Philippines, Vietnam and other regional powers India and Japan are running rings around China on the South China Sea dispute issue and showing China the middle finger. China is so face conscious to admit it that their foreign policies on South China Sea are a total disaster. It’s following of the path of its predecessor, the Ching dynasty, of surrendering the nation’s sovereignty and interests in exchange for earning scant western’s hypocritical flattery of being a ‘responsible nation’. Those western neocon China threat operatic tenors look set for new jobs in the future, hahaha.
Jack Smith, USA at 2011-10-1324.26.135.*
If Obama vetoes the U.S. currency bill, it"s a clear victory for China, as it will show that China controls the U.S. from afar. Jack Smith, USA
PD User at 2011-10-1375.161.13.*
China they are undermining our economy and destroying the american work force. They dont play far so why should we. They need us more than we need there cheap goods. Besides they poison our apple juice there is lead in baby toys coming from there. They are our enemy. First Iran then China. Oh rahhh

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