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US Republicans: Bill voted for political gain

09-26-2010 08:30 BJT Special Report:US Tightens Pressures on Yuan Rise |

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With the United States stepping up pressure on the Renminbi exchange rate, discussion over the issue is expanding as well.

Many critics in the US accuse China of keeping its currency undervalued, giving its exporters an artificial advantage over their US competitors.

Some regard the RMB exchange rate as the scapegoat for America's trade deficit with China and partially to blame for the US's struggling economy.

However, Premier Wen Jiabao objects at the accusation, saying "to a large extent the trade imbalances between the two countries cannot be blamed on the Renminbi exchange rate".

Analysts say the imbalance mainly lies in the two countries' different trade and investment structures. Most of China's exports are labor intensive, low value added consumer goods which US manufacturers seldom produce. They claim that if the US loosens restrictions over the export of advanced technologies, the trade imbalance would probably reverse.

Premier Wen Jiabao says there's no basis for a drastic appreciation of the RMB. He also says China will continue to deepen the reform of the RMB exchange rate mechanism, allowing the yuan to fluctuate more freely.

Some people in the US call Congress's move dangerous, worrying it could raise trade tension with China.

Some Republicans accuse the Democrats of forcing a vote for political gain in the upcoming Mid-term Election. Republican Representative Kevin Brady is worried it could damage US efforts to compete in the growing Chinese market.

What is the bill about:

US panel approves punitive measures to let yuan appreciate

A US congressional panel has approved a bill to impose punishing duties on imports from China. The move is poised to ratchet up pressure on China to let the yuan appreciate more quickly. Full story >>

Editor:Zhang Jingya |Source: CNTV

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