China's Foreign Ministry says the United States should not pressure Beijing to revalue its currency, or blame China for what it calls U.S. internal economic problems. The rebuke comes after U.S. senators announced plans to introduce legislation to pressure China on its currency, which they blame for American job losses and an increasing U.S. trade deficit. Daniel Schearf reports from Beijing.
China's Foreign Ministry spokesman Qin Gang said Thursday the U.S. should not pressure or threaten to pressure China to increase the value of its currency.
Two U.S. senators, New York Democrat Charles Schumer and South Carolina Republican Lindsey Graham this week renewed efforts to introduce a bill to the U.S. Congress that would push China to revalue its currency, the renminbi.
The senators and American manufacturers say Beijing keeps its currency artificially low to keep Chinese exports cheap. They say this costs millions of American jobs and contributed to a record 232 billion dollar trade deficit with China last year.
Qin says the U.S. should not blame China for what it calls "internal" economic problems of the U.S. He says this is neither reasonable nor fair. He also questioned why a free market economy such as the U.S. would adopt an interventionist or command economy approach towards others.
"Should the renminbi exchange rate for China reflect the change of demand and supply in the market or listen to or reflect some countries' or peoples' commands?" he asked.
In 2005 China changed the renminbi's fixed peg with the U.S. dollar to a basket of currencies, allowing its value to fluctuate more in line with market conditions. The renminbi has since gone up in value about five percent.
But critics such as Senators Graham and Schumer say Beijing still has far too much control over the renminbi and is manipulating the currency to make its exports more competitive. They say they are losing patience and the currency needs to go up higher in value, and faster.
The two senators last year sought to introduce a bill to impose a 27.5 percent tariff on imports from China unless Beijing raised the value of the renminbi. The senators dropped the bill after visiting China to discuss the matter with Chinese officials.
Qin says China will continue to reform the exchange rate, but at a "rational" and "stable" rate so as not to affect economies in the region or the world. He did not elaborate.
Senators Graham and Schumer say the bill they are crafting will be in line with World Trade Organization rules and will be introduced within months.
U.S. lawmakers also complain about currency manipulation by Japan, alleging the Japanese currency, the yen, is kept artificially low against the dollar. Legislation is in the process of being lodged in the U.S. Senate to require Washington to work with other countries in forcing Japan to stop what it calls manipulation of the currency.