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Wen Jiabao, Chinese Premier
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China will keep the yuan basically stable at a reasonable level.
I can understand some countries' desire to raise exports, but what I do not understand is depreciating one's own currency and attempting to pressure others to appreciate, for the purpose of increasing exports. In my view, that is protectionism.
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Barack Obama, US President
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Chinese movement to a more market-oriented exchange rate is needed to help efforts to rebalance the global economy.
Countries with external surpluses need to boost consumption and domestic demand.
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Xia Bin, economist of State Council
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The yuan's value is not the cause of the US deficit, which is actually caused by its defective economic structure.
The US trade deficit is mainly a result of its low savings and high consumption rates, and the fact that its manufacturing capacity has mostly shifted overseas, such as China.
It has few products to export and among the few it can sell overseas, it has blocked exports of high-tech products to China.
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Will yuan revaluation cut US deficit? |
The debate on the valuation of the yuan has been escalating. Chinese Premier Wen Jiabao said on March 14 that the Chinese currency is not undervalued while US President Barack Obama pushed for China to change its currency policy. |
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Stephen Roach, chairman of Morgan Stanley Asia
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I believe the currency adjustment that is being suggested by the West is the wrong way to go.
If China were to adjust its currency sharply higher, the Chinese share of the US multilateral trade deficits would shift to another country, a higher cost producer, which would have the effect of imposing a tax on American workers that the politicians are in theory trying to protect.
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Zhang Monan, economics researcher with State Information Center
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The US has always adopted an egotistical and unilateralist dollar policy. The currency has been considered an effective instrument to balance the US' national interests and manage crises. A depreciated dollar has helped boost US exports and reduce its trade deficits against other countries.
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Liam Halligan, British economist
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The president is playing with fire... Obama really should tread carefully. At the same time, the US is now at risk of sparking what could be an all-out trade war.
Beijing will eventually allow the yuan to rise, but in its own time and in order to tackle inflation and not because of US pressure.
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Posted on 2010-03-19 17:25
The trade surplus is due to american lack of products to sell chinese because of hi-tech limitation.
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Posted on 2010-03-15 20:53
A slowly rising Yuan is in China's long-term interest. That is exactly what is taking place.
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Posted on 2010-03-16 18:19
Obama should change the current exchange regime to a fixed exchange rate regime, then he can set whatever exchange rate he deemed fit!!!
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True, other countries have suffered greater setback in foreign trade - which perhaps helped China to overtake Germany as the world's second largest exporter last year.
But their exports dropped largely because of two factors, both unrelated to China's exchange rate policy. First, declining incomes and greater job insecurity in wealthier economies have shifted consumer demand toward less expensive goods. Second, last year saw the end of the EU and US quota on the import of Chinese textiles and footwear. [Full Story]
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2010-03-15 13:25
I personally hope that China will raise the value of its money. I think that this decision is hurtful for the Chinese people.
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2010-03-15 11:18
The future is not bright for china, because other nations will counterattack.
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Posted on 2010-03-18 03:21
Remember what China is doing is imposing a UNILATERAL unfair economic condition.
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