Linking the issue of China's currency regime reform to the
United States' growing trade deficit with China is "detrimental to
both sides," a spokesman with the Ministry of Commerce said
Friday.?
"The current friction in Sino-US trade is normal," spokesman
Chong Quan told a press conference on Friday.?
The response came after two US senators threatened Thursday to
push for a vote on punitive tariffs against China for making little
progress on reforming its currency regime.
He said that China hoped both sides could resolve disputes
through peaceful consultation. "Taking restrictive or protective
measures in Sino-US trade relations will damage the interests of
both sides," he said.
On Thursday, Senators Charles Schumer and Lindsey Graham
submitted a request to the Senate leadership for a vote on a bill
seeking to impose a punitive tariff of 27.5 percent on Chinese
imports unless China revalues its yuan currency.
China started to revalue its currency, the yuan, in July last
year by linking it to a basket of currencies instead of the
greenback alone and allowing it to move within a 0.3 percent
floating band, up or down, each day.
Over the past 13 months, the currency has been strengthening
gradually and has gained nearly 3 percent in value.
However the measure, together with the removal of export
subsidies, the elimination of certain tax rebates and higher export
tariffs, failed to take the wind out of the country's headlong
export growth.
In August, the surplus hit US$18.8 billion, the third monthly
high in a row, and may break US$20 billion some time this year.
"The reason for China's export boom is not the so-called
undervalued Renminbi but the strong demand in the world market for
China-made products and economic globalization, which has turned
China into a world production base," said Dr. Shen Danyang,
vice-president of the International Trade and Economic Research
Institute under the Ministry of Commerce.
To ease its trade imbalance, the State Council is devising
policies to facilitate imports.
(Xinhua News Agency September 16, 2006)