US President George W. Bush's administration rejected a call by
US lawmakers to take China to the World Trade Organization for
"currency manipulation."
The US Trade Representative's office said such measures would
not help, and might hinder, Chinese progress towards letting the
yuan free from a fixed peg with the dollar.
The request was made by 30 members of the US Congress.
The congressmen accused China of manipulating its currency to
gain unfair trade advantages over the United States. Chinese yuan's
value is pegged at about 8.3 yuan to the dollar.
In a statement, Neena Morjani, a spokeswoman for US Trade
Representative Robert Zoellick, said the administration believed
that to bring such a case to the WTO would undermine the White
House's diplomatic efforts to pressure China for a change in its
currency policies.
"A Section 301 action would not assist in these efforts, and
indeed could be more damaging than helpful at this time," she said.
"We therefore must decline to accept the course of action
recommended through this latest petition."
"Working closely with US Treasury officials, China, according to
Governor Zhou
Xiaochuan of , has made this a top priority and has made a series of
policy moves to liberalize rules governing foreign exchange
transactions, moved to strengthen and develop the finance sector,
adjusted interest rates, and taken other steps toward increasing
flexibility in financial policymaking; these are clear signs that
the administration's efforts are paying dividends," the statement
read.
The congressional group petitioned the Bush administration in
late September, urging the US government to file a case under
Section 301 of the US trade law that would allow the United States
to impose penalties on Chinese goods if the WTO rules against
China.
Wei Benhua, deputy director of the Chinese State Administration
of Foreign Exchange, said in Beijing this week that China's
long-term goal was "to achieve complete convertibility of RMB
(yuan)," according to Xinhua news agency.
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(China Daily November 14, 2004)