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Currency reform not to drag down exports

By Ding Qingfen (chinadaily.com.cn)
Updated: 2010-06-27 04:22

Toronto - China's foreign exchange reform and appreciation of its currency will not lead to big sharp in its exports, neither will this result in shrinkage of trade protectionist measures against China by the worldwide, said officials from the Ministry of Commerce.

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 And Yu Jianhua, director general of the Department of International Trade and Economics Affairs of the Ministry of Commerce, also said he feels "hopeful" about the prospects of China's exports for the second half of the year, thanks to the global economic recovery, suspended European debt crisis and rising cost for recruiting labors and raw materials.

"The impact is there, but generally speaking, it is not big enough," Yu said.

And "Chinese exporters on general trade will feel bigger impact from on processing trade," he added.

China last week initiated foreign exchange rate reform, two years later after Chinese government pegged yuan to the US dollar in July 2008. Last week, the yuan has gained 0.53 percent this week, the most since December 2008.

The American Senators said on Thursday that China's move was not enough to produce rapid gains in currency revaluation, and they required the US Commerce Department to treat "undervalued" currencies as an unfair trade subsidy under US trade law so that the US government could impose a "countervailing duty" on Chinese exports.

"Trade protectionist measures against China will not reduce until the foreign nations put brake on constrains on Chinese imports," Yu said.