China Urges US to Resist Senate Currency Bill

Posted October 12th, 2011 at 5:45 am (UTC-5)
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China is warning about the consequences of a U.S. Senate bill passed Tuesday that could bring sanctions against China or any country found to be deliberately manipulating the value of its currency.

China’s state television read a statement from Foreign Ministry spokesman Ma Zhaoxu saying the bill is a protectionist measure that violates world trade rules and will do nothing to help the U.S. economic situation.

He also said the bill will disrupt U.S.-China trade relations.

Song Hong, the director of the International Trade Department at the government-affiliated Chinese Academy of Social Science, told VOA that the Senate vote could undermine the global economic recovery.

The Senate bill provides for U.S. sanctions if the Treasury Department finds a country is manipulating its currency and not taking steps to fix it. It also would make it easier for U.S. companies to seek tariffs on foreign imports.

Many U.S. lawmakers say Chinese currency manipulation gives its goods an unfair advantage on world markets by making U.S. products too expensive. Opponents of the bill say they fear it could start a trade war with China.

Beijing denies deliberately undervaluing the yuan. It says it is taking steps to let its value rise and fall naturally against the dollar.

The bill now goes to the House of Representatives, where passage is uncertain. Republican Majority Leader Eric Cantor is asking the White House to take a formal position on the bill before the House considers it.

President Barack Obama has not officially come out for or against the measure. But the White House says it wants to be cautious and make sure any new law does not violate WTO rules.