China has not done enough on yuan: Obama
By Doug Palmer, ReutersWASHINGTON -- U.S. President Barack Obama said on Monday that China has not done enough to raise the value of the yuan, keeping up tough American rhetoric on Chinese policy as U.S. lawmakers weigh new legislation to punish Beijing.
September 22, 2010, 11:17 am TWN
A bipartisan group of former cabinet officials warned Congress, however, that action against China for not letting its currency rise faster could backfire on the United States.
And U.S. Trade Representative Ron Kirk said it was not clear whether various bills in Congress to pressure China on the currency issue were legal according to World Trade Organization rules.
The yuan “is valued lower than market conditions would say it should be,” Obama said, giving China an advantage in trade because it makes Chinese goods less expensive in the United States and U.S. goods more expensive in China.
“What we've said to them is you need to let your currency rise in accordance to the fact that your economy's rising, you're getting wealthier, you're exporting a lot, there should be an adjustment there based on market conditions,” Obama said at a town-hall style meeting hosted by CNBC television.
“They have said yes in theory, but in fact they have not done everything that needs to be done,” Obama said.
Calling for a fairer trade relationship with Beijing, Obama said Washington was bringing more actions against China before the WTO. “We are going to enforce our trade laws much more effectively than we have in the past,” he said.
With the currency issue tensing relations, Obama will meet with Chinese Premier Wen Jiabao when the two attend the U.N. General Assembly in New York later this week.
U.S. Treasury Secretary Timothy Geithner said last week he will rally other world powers to push China for trade and currency reforms.
In New York, Secretary of State Hillary Clinton and Chinese Foreign Minister Yang Jiechi discussed currency issues at length during a meeting on the sidelines of the annual gathering of the U.N. General Assembly.
“It was a significant part of the discussion,” State Department spokesman P.J. Crowley told reporters.
“Obviously it is an important aspect of our bilateral relationship,” he said. “We both understand that this is something that both substantively and politically is a vitally important element of the relationship.”
The two discussed a broad range of other issues, including sanctions on Iran and North Korea and the prospect of a visit to the United States by Chinese President Hu Jintao, but Yang brought the currency issue up and it was a major part of the discussion, Crowley said.
“We both understand that this is something that both substantively and politically is a vitally important element of the relationship,” Crowley said. “It was a significant part of the discussion.”