September 30, 2010China criticizes US currency bill as protectionism
BEIJING – China on Thursday rejected a measure passed by U.S. lawmakers to allow sanctions over currency manipulation as protectionist and a violation of global free-trading rules.
The Commerce Ministry statement gave no indication whether Beijing might retaliate for the bill approved Wednesday by the U.S. House of Representatives. The legislation requires Senate approval and action there is not expected until after November elections.
The measure will not resolve the U.S. trade deficit with China, said Commerce Ministry spokesman Yao Jian.
Washington and other governments complain China's yuan, also known as the renminbi, is kept undervalued, giving its exporters an unfair price advantage and swelling its trade surplus.
"This measure does not fit World Trade Organization rules," Yao said in a statement carried by the official Xinhua News Agency. "You cannot say the renminbi exchange rate is undervalued because of the U.S. trade deficit with China and impose such protectionist measures based on this."
The legislation would allow the imposition of stiff sanctions on Chinese imports. It would expand the definition of improper government subsidies to include a government's manipulation of its currency to gain trade advantages.
Currently, the U.S. Commerce Department does not consider currency manipulation as a government subsidy for which it can impose trade sanctions.
