CHINA FILE: China says yuan is not to blame for trade surplus/Warns Google against flaunting country's laws

Record ID: 1540288

  • Title: CHINA FILE: China says yuan is not to blame for trade surplus/Warns Google against flaunting country's laws
  • Date: 17th March 2010
  • Summary: BEIJING, CHINA (FILE - 2010) (REUTERS) EXTERIOR OF PEOPLE'S BANK OF CHINA RMB BEING COUNTED IN MONEY COUNTING MACHINE BANK CLERK PUTTING RMB INTO MONEY COUNTING MACHINE ELECTRONIC BOARD SHOWING RMB EXCHANGE RATE TO DIFFERENT FOREIGN CURRENCIES PEOPLE AT BANK US DOLLARS BEING COUNTED IN MONEY COUNTING MACHINE
  • Embargoed: 1st April 2010 03:27
  • Keywords:
  • Topics: International Relations,Economic News
  • Reuters ID: LVA6W12MTHPSZRVQ5G5FTEB723SG
  • Aspect Ratio: 16:9
  • Story Text: China on Tuesday (March 16) again rejected U.S. demands for a stronger yuan, saying the currency's exchange rate was not a reason for its bilateral trade surplus with the United States.
    Beijing and Washington appear to be locked in a dialogue of the deaf in the run-up to a determination by the U.S. Treasury Department due on April 15 as to whether China is manipulating its exchange rate.
    "The trade surplus is not caused by the renminbi (RMB) exchange rate. The trade surplus is an outcome and phenomenon of globalisation. It will exist for a time. Whether China, which has a trade deficit with Japan, South Korea and some developing countries, should emulate the United States and pass a law to deal with those countries? So we hope that in surmounting the crisis and reviving its economy, the United States should be a promoter of free trade, not an obstacle to it," Commerce Ministry spokesman Yao Jian told a regular news conference.
    Yao was responding to a letter sent by 130 U.S. lawmakers on Monday (March 15) to the administration of President Barack Obama demanding that he get tough with China over its currency practices.
    "The impact of China's currency manipulation on the U.S. economy cannot be overstated. Maintaining its currency at a devalued exchange rate provides a subsidy to Chinese companies and unfairly disadvantages foreign competitors," the legislators had said.
    Premier Wen Jiabao on Sunday (March 14) dismissed U.S. complaints about China's exchange rate, calling them counterproductive and saying he did not believe the yuan was undervalued.
    China has kept the yuan pegged around 6.83 per dollar since July 2008 to help its exporters, and Yao said stability would remain the watchword in 2010.
    He also warned Google, the world's largest search engine, against flaunting the country's laws, as expectations grow for a resolution to a public battle over censorship and cyber-security.
    "We hope that Google can respect the law and play by the rules whether it stays in or leaves China. It should still play by the rules even if it is leaving and handle the remaining issues properly. Meanwhile, we are against politicising commercial issues," said Yao.
    The chief executive of Google, Eric Schmidt, said last week he hoped to announce soon a result to talks with Chinese authorities on offering an uncensored search engine in China.
    Google in January threatened to pull out of China if it could not offer an unfiltered Chinese search engine, after cyber attacks originating from China on it and about 30 other firms.
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