Tags: China | currency | debate | US

China Will Not Yield on Currency Issues

Wednesday, 14 Apr 2010 11:21 AM

WASHINGTON - China won't bow to foreign pressure to reform its yuan exchange-rate policy, a senior Chinese official said.

Calling the reform "an internal affair," Cui Tiankai, vice minister of foreign affairs, said at a news briefing after a two-day global nuclear-security summit that Chinese policymakers are committed to the goal of reform because it meets the nation's own need for economic and social developments.

"It is not justified for outsiders to exert pressure on China and we will not take actions by bowing to this pressure," said Cui.

Cui's comments, echoing those of Chinese President Hu Jintao during his bilateral meeting with U.S. President Barack Obama on Monday, came amid rising speculation of a near-term appreciation of the yuan against the dollar, possibly as soon as the end of this week.

U.S. lawmakers have blamed China's currency regime for job losses in the U.S. manufacturing sector. The rationale is that by keeping the yuan artificially undervalued, China is giving its exporters the upper hand in the global market.

But Cui argued that the yuan's value isn't the cause of many problems in the global economy. On Monday, Hu told Obama that the yuan's revaluation won't solve the trade imbalances between the two countries, nor would it address the high unemployment rate in the U.S.

"You got a cold and you asked your neighbor to take pills. That won't solve the symptom of your flu," said Cui.

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