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  • » 04/22/2010, 00.00

    CHINA – UNITED STATES – JAPAN

    IMF joins the world to ask Beijing to revalue its currency



    In its World Economic Outlook, the International Monetary Fund says only a new Chinese monetary policy can guarantee a global economic recovery. It also warns Japan to invest more. The United States prepares to hit China’s aluminium export to send Beijing a strong signal.
    Beijing (AsiaNews/Agencies) – China should allow market forces to set the value of the yuan, whereas Japan should enhance its economic stimulus measures, said the International Monetary Fund (IMF) in its semi-annual World Economic Outlook, which was released on Wednesday. In the meantime, the US Commerce Department said that it was close to deciding what to do in relation to China’s currency, a major thorn in US-China relations.

    For the IMF, Japan’s “tentative” economic recovery is an exception in a region that is leading the global rebound, fuelled by consumer spending and investment in China and India.

    For the Washington-based fund, policy makers in several countries should embrace stronger exchange rates. “Currencies of a number of emerging Asian economies remain undervalued, substantially in the case of the renminbi,” the IMF report said.

    The Group of 20 emerging and developed nations, whose finance chiefs meet tomorrow in Washington, should also discuss coordinating policies to strengthen the global recovery, the IMF said. Equally, it’s “essential” for China to respond positively to the demands of the rest of the world for a new currency policy.

    Currently, the yuan is pegged at 6.83 against the US dollar, and this since July 2008. For Western economists and analysts, such a fixed rate has allowed China to remain highly competitive.

    It has also allowed China to accumulate huge holdings in US securities that have been steadily growing in value; any change in the exchange rate, as envisaged by US president Barack Obama, could reduce their value by as much as a third.

    However, the situation has also led to a long-standing row between Beijing and Washington. Although both sides can harness good arguments, a solution still seems far away. In any event, the United States remains China’s main export market, whilst Washington needs Beijing’s support at the United Nations to stop Iran.

    In the meantime, the US Commerce Department could decide this week whether to launch a groundbreaking investigation into charges that China is subsidising exports of moulded aluminium extrusions, a material that is used in the automobile and construction industries, by undervaluing its currency.

    US producers filed a petition recently calling for an investigation into whether Beijing subsidises exports of aluminium extrusions by undervaluing the yuan. If the department finds in favour of the petitioners, it could impose countervailing duties to offset losses by US companies.

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    See also

    09/10/2007 CHINA – EUROPEAN UNION
    Europe complains about low yuan
    Euro-zone finance ministers criticise Beijing for keeping its currency artificially low to increase its trade advantages. The issue will be discussed October 19 when G7 finance ministers meet. The European Union is divided.

    12/11/2009 CHINA – UNITED STATES
    Hu and Obama in the war over the yuan
    Monetary policy will be a major topic on the US president’s agenda during his official visit to China. In light of the current economic crisis, China’s currency and how it is managed cannot be ignored. Beijing is in favour of revaluation but decoupled from the greenback.

    05/10/2009 CHINA
    Beijing wants IMF voting quotas to reflect contributions
    For China, IMF representation should reflect members’ contribution. Beijing rejects calls for yuan’s revaluation and pushes IMF to give more leeway to emerging nations and control world economy.

    09/12/2008 ASIA
    Economic crisis: US, China and the coming monetary storm
    The massive levels reached by the foreign debt of the United States and the excessive and unjustified devaluation of China’s yuan are two high risk factors for the world economy and stability. Solutions found so far may be useful for financial institutions but not for the population. A “transnational” oligarchy is emerging that includes central banks, the Chinese Communist Party, Russia’s oligarchies and oil sheiks.

    10/10/2012 CHINA - JAPAN - IMF
    Islands not only reason for China IMF snub
    The governor of China's central bank, who was set to deliver the closing lecture at Tokyo IMF meeting, cancelled speech and attendance. Using the diplomatic row over the Diaoyu/Senkaku Islands, Beijing is showing its irritation over the fact that it is not included in a basket of currencies used in world economic transactions.



    Editor's choices

    HONG KONG - CHINA - VATICAN
    Mass for a deceased underground priest. Card. Zen asks for God ‘s grace to save the Church in China and the Holy See from the 'precipice'

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    Fr. Wei Heping, 41, died in mysterious circumstances, his body dumped in a river in Taiyuan (Shanxi). For the police claim he committed suicide. Family members are not allowed to even see the autopsy report. For Card. Zen the Holy See (which "is not necessarily the Pope") seeks a compromise at all costs with the Chinese government, risking "to sell out the faithful Church". Justice and Peace publish a booklet about Fr. Wei, not to forget.


    VATICAN - ITALY
    Pope: No more war, its only fruit is death, 'our self-destruction'



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