Accessibility links

Breaking News

US Treasury Secretary Urges China to Move Faster on Currency Reform

U.S. Treasury Secretary John Snow says he has received assurances from China that it will eventually move to allow its currency, the yuan, to trade more freely.

U.S. Treasury Secretary John Snow, Federal Reserve Chairman Alan Greenspan and other top officials met with their Chinese counterparts for two days to urge the Chinese to do more to open up their markets.

High on the agenda were Washington's calls for Beijing to take further steps to allow market forces to drive the Chinese currency's value.

China began that process in July by removing the yuan's peg to the dollar, but Secretary Snow said he reiterated U.S. demands for China to do more. He told reporters Monday he had received assurances from Chinese Finance Minister, Jin Renqing and Central Bank Governor Zhou Xiaochuan that more currency liberalization measures are coming.

"Governor Zhou and Minister Jin reaffirmed this fundamental commitment and reviewed with me a number of initiatives under way in financial markets, particularly with respect to the trading platform," he said.

However, China did not provide a timetable. Chinese officials have previously said they need time to make adjustments to avoid disrupting their fast-growing economy.

During their meetings, the U.S. officials laid out a set of guidelines on opening China's markets they said would make the country more prosperous and stable.

"To say we have a roadmap would be too grandiose a characterization," said Mr. Snow. "We do have a long list of things that are being worked out - things we're suggesting need to be dealt with."

U.S. officials are also calling on China to allow foreign firms wider access to China's markets by removing investment caps and other restrictions.

Washington's suggestions come as pressure grows on the Bush administration to address the U.S.-China trade gap, which reached $162 billion last year. Some U.S. politicians and labor groups believe China's currency controls are contributing to the trade deficit by making American products uncompetitive.

Some lawmakers are pushing for legislation to slap tariffs of more than 27 percent on Chinese products if China does not revalue its currency. Secretary Snow described this proposal Monday as "ill-conceived", saying he hoped to demonstrate to U.S. critics that China is making progress in reforming its financial markets and currency.