CHINA: U.S. TREASURY SECRETARY JOHN SNOW ARRIVES IN BEIJING FOR TALKS ON POSSIBLE REVALUATION OF YUAN.

Record ID: 222962

  • Title: CHINA: U.S. TREASURY SECRETARY JOHN SNOW ARRIVES IN BEIJING FOR TALKS ON POSSIBLE REVALUATION OF YUAN.
  • Date: 2nd September 2003
  • Summary: (U3) BEIJING, CHINA (SEPTEMBER 2, 2003) (REUTERS - ACCESS ALL) 1. GV: EXTERIOR OF ST REGIS HOTEL WITH FLAGS FLYING 0.05 2. CU: U.S. AND CHINESE FLAGS 0.10 3. GV: CAR WITH U.S. TREASURY SECRETARY JOHN SNOW INSIDE 0.22 4. CU: CAMERAMEN 0.26 5. MV/PAN: SNOW ENTERING HOTEL, GREETS CHINESE OFFICIALS 0.37 6. GV/PAN/CU: SNOW WALKING THROUGH LOBBY; CAMERAMEN (4 SHOTS) 0.58 7. MCU/PAN: (SOUNDBITE) (English) JOHN SNOW, U.S. TREASURY SECRETARY, RAISING HIS HAND AND SAYING, AS HE WALKS OUT: "It's good to be in Beijing" 1.06 8. CU/GV/PAN: SNOW IN CAR OUTSIDE; CAR PULLS AWAY (2 SHOTS) 1.29 Initials Script is copyright Reuters Limited. All rights reserved
  • Embargoed: 17th September 2003 13:00
  • Keywords:
  • Location: BEIJING, CHINA
  • Country: China
  • Reuters ID: LVA5PT04SY86I18ADRINIQ35SGMN
  • Story Text: U.S. Treasury Secretary John Snow has arrived in
    Beijing under pressure at home to urge China to revalue the
    yuan.



    U.S. Treasury Secretary John Snow arrived in
    China to raise U.S. concerns over the yuan's peg to the dollar.

    But brushing off calls for revaluation, China said it
    would maintain the stability of the yuan.

    Snow, who landed in Beijing on Tuesday afternoon
    (September 2), is under pressure at home to urge China to
    revalue the yuan, which is pegged to the dollar, to save
    jobs at hard-pressed U.S. factories.

    American manufacturers claim a cheap yuan, held around
    8.3 to the U.S. dollar, gives Chinese rivals an unfair edge.

    But brushing off calls for revaluation, Foreign
    Ministry spokesman Kong Quan (pron: kong tchyen) on Tuesday
    said China would maintain the stability of its currency and
    improve its exchange rate mechanism in line with the
    country's development.

    China is worried about the damage a revaluation may
    cause to export growth that has helped fuel one of the
    world's fastest-growing economies.

    It has dug in against the pressure to revalue -- mainly
    from the United States, Japan and South Korea -- saying
    jobs and social stability are more important than changing
    the yuan peg.

    But Beijing, continuing with a series of adjustments to
    capital controls aimed at easing the yuan's appreciation,
    said it would raise the limit on the amount of foreign
    exchange Chinese travellers could buy from banks.

    This minor adjustment to capital controls was unlikely
    to satisfy U.S. manufacturers, who have targeted China's
    currency in a debate that is gathering steam ahead of the
    U.S. election.

    While in Asia, Snow has said little publicly about
    China's currency but Japanese
    Finance Minister Masajuro Shiokawa said they had agreed in
    talks in Tokyo the market should set the value of the yuan.

    Shiokawa said Japan would try to convince Beijing that
    changing its policy would benefit China.

    Snow is due to meet central bank Governor Zhou
    Xiaochuan (pron: djoe hsiao tchwan) and Finance Minister
    Jin Renqing (pron: djin ren tching) on Tuesday afternoon.

    On arrival, he said he was looking forward to "good
    meetings".

    China had a $103 billion trade surplus with the United
    States last year. Money from exporters, combined with
    strong investment inflows and speculators hoping to make
    money if Beijing buckles, have pushed Chinese foreign
    exchange reserves through the roof.

    Battling to soak up these foreign inflows, which have
    pushed reserves to $357 billion, the Chinese central bank
    has pushed up money supply -- running the risk of boosting
    inflation in red-hot sectors such as property.

    The U.S. Treasury chief travels to Thailand on
    Wednesday (September 3) for a meeting of Asia-Pacific
    finance ministers, where the yuan debate is expected to be
    a central feature.
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