ALTERNATIVES TO REVALUATING THE YUAN
Xiao Geng
China Daily, March 25, 2010
Xiao Geng
China Daily, March 25, 2010
Editor's note: According to the author, it’s not the appropriate time to revaluate yuan in consideration of national interests of both US and China. But he suggests some structural and institutional reforms as alternative options.
The debate on how to correct the trade imbalance between the United States and China is focused on increase: How to increase US exports and savings and how to increase Chinese imports and consumption.
A big part of the debate, especially in the US, is focused on China's currency, which US leaders allege is undervalued. The Americans want China to revalue the yuan considerably in the hope that it would lead to an increase in US exports and employment.
Chinese leaders differ. They regard the US pressure to revaluate the yuan and Washington's protectionist measures as unfair and detrimental to China's development. They place emphasis upon structural and institutional reform to increase Chinese consumption and make domestic investment more efficient.
Why is there such a considerable gap between Chinese and US views?
The US demand for the revaluation of the yuan is based upon its short-term concern over China's large current account surplus and long-term worry over China's high growth, rapid urbanization and industrialization, low national debt and low fiscal deficits.
The debate on how to correct the trade imbalance between the United States and China is focused on increase: How to increase US exports and savings and how to increase Chinese imports and consumption.
A big part of the debate, especially in the US, is focused on China's currency, which US leaders allege is undervalued. The Americans want China to revalue the yuan considerably in the hope that it would lead to an increase in US exports and employment.
Chinese leaders differ. They regard the US pressure to revaluate the yuan and Washington's protectionist measures as unfair and detrimental to China's development. They place emphasis upon structural and institutional reform to increase Chinese consumption and make domestic investment more efficient.
Why is there such a considerable gap between Chinese and US views?
The US demand for the revaluation of the yuan is based upon its short-term concern over China's large current account surplus and long-term worry over China's high growth, rapid urbanization and industrialization, low national debt and low fiscal deficits.
(...) [artículo aquí]
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