Economy

US yuan bill violates WTO rules: Beijing

(Xinhua)
Updated: 2010-09-30 12:57

BEIJING - The US-proposed anti-subsidy investigation against Chinese imports on the grounds of exchange rate violates the rules of the World Trade Organization (WTO), Yao Jian, spokesman of China's Ministry of Commerce, told Xinhua Thursday.

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The US House of Representatives Wednesday passed the Currency Reform for Fair Trade bill, to allow the United States to seek trade sanctions against its trade partners for allegedly manipulating their currency, a new move indicating the US' rising trade protectionism.

Yao said Sino-US trade relations had long been mutually beneficial as China is United States' fastest-growing export destination.

He attributed the US customs figures that the US exports to China rose 36.24 percent during the first seven months from the same period a year ago, 14.4 percentage points higher than the Chinese exports to the United States.

Also US exports to China are 13.6 percentage points higher than its overall exports, he said.

He said China is willing to take measures, together with the US side, to help balance bilateral trade relations.

China hoped all parties in the United States could evaluate the facts in an objective and comprehensive way, and make the right decision conducive to long-term economic and trade relations between the two countries, and which would also be beneficial to its own interests, he said.

With November's midterm elections approaching and mounting pressure from recession-weary voters, US lawmakers are increasingly arguing that an under-valued yuan gives Chinese imports an unfair trade advantage.

Yao refuted that China has gained trade advantages by means of an under-valued yuan. The outcome of trade between the two countries was instead dependent on the trade and investment structures.

China not only has a trade surplus with the United States, but also with other Asian countries, he said.

A trade surplus should not be blamed on an under-valued yuan, neither should it be used as an excuse for trade protectionism, he said.

Unilateral restrictions could not re-balance the bilateral trade. The United States should lift the ban on high-tech exports to China, and expand its export categories, he added.

Although the bill has been passed in the House of Representatives, some analysts hold that the bill may never become law, as it faces an uncertain future in the Senate.

Some US congressmen also take it as an unwise policy. Representative Jeb Hensarling has argued that passing the bill would not create more jobs for US but could trigger a trade war.