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China, US to cooperate on yuan: Bush
(AP)
Updated: 2005-11-21 16:06
Washington and Beijing will cooperate toward making the yuan's exchange rate
more responsive to market forces of supply and demand, visiting U.S. President
George W. Bush said on Sunday.
Chinese cash. China will 'unswervingly' press
ahead with currency reform, Chinese President Hu Jintao said after a
meeting with his US counterpart George W. Bush.
[AFP] |
China revalued the yuan by 2.1 percent in July and cut it loose from the
dollar so it could float within tightly managed bands. But since
then, the yuan rose only a further 0.33 percent against the dollar.
Bush said he applauded the July reform.
"I also reminded the leaders that we've seen some movement but not much in
the currency valuation," he told reporters after his meetings with Chinese
officials. "And I explained to them as clearly as I could that the value of the
Chinese currency is very important for manufacturers and workers in the United
States."
Earlier, at a joint news conference with Chinese President Hu Jintao, Bush
said: "We'll continue to work with China to help implement its July commitment
to a flexible, market-based currency."
Without giving details, Hu said China would press ahead with the reform of
the yuan and "join hands" with the United States to gradually restore balance in
trade between the two countries.
"The frictions and problems that may arise in this rapid development of
two-way trade may be properly addressed through consultations," Hu said.
China and the United States removed one of the thorns in the side of two-way
trade ties this month when they agreed on curbs on the growth of Chinese textile
exports until the end of 2008.
But China's export prowess is rankling with many U.S. law-makers. Senators
Charles Schumer, a New York Democrat, and Lindsey Graham, a South Carolina
Republican, propose a 27.5 percent tariff on imports from China -- the degree by
which they say the yuan is undervalued -- unless China acts soon.
The two delayed a vote on their bill last week, citing the timing of Bush's
visit, but said it would take place by March 31.
According to U.S. figures, the United States had a trade deficit of $162
billion with China in 2005, a gap that is on course to grow to $200 billion this
year.
"They need to move," said Faryar Shirzad, an economic affairs specialist with
the White House National Security Council. "We understand the move to full
flexibility will have to be gradual and implemented over time. But it's really
time for them to begin to move much further than they have already," he told
reporters on Saturday aboard Air Force One.
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