Beijing, February 05: China hit back at the United States after President Barack Obama vowed to get tougher with the Asian giant on trade and currency, stoking tensions already high over Taiwan and Tibet.
Obama on Wednesday hinted he would take Beijing to task over the strength of its yuan currency, responding to growing discontent in the US Congress over Chinese monetary policy as the US economy makes an uncertain recovery.
“Wrongful accusations and pressure will not help solve the issue,” foreign ministry spokesman Ma Zhaoxu told reporters when asked about Obama’s comments. He also called for both countries to make efforts to develop their relations. “We should respect each other’s core interests and major concerns, so as to ensure the steady development of our relations.”
In a meeting with senators from his Democratic Party Wednesday, Obama said he supported trade agreements with China but urged the developing power to open its markets further to US goods. “The approach that we are taking is to try to get much tougher about enforcement of existing rules,” Obama said.
He said what was needed was “putting constant pressure on China and other countries to open up their markets in reciprocal ways. One of the challenges we have got to address internationally is currency rates, and how they match up to make sure that our goods are not artificially inflated in price and their goods are artificially deflated in price.”
Many policymakers in developed economies accuse China of keeping its yuan artificially low for the sake of its manufacturing industry, funding a flow of cheap exports around the world.
But China argues that its peg to the dollar offers stability in a rapidly changing economy and has warned in turn against US protectionism. “The RMB exchange rate has never been the major cause for the trade deficit of the US,” Ma said.
The Chinese comments could increase existing tensions over an arms deal between US and Taiwan, and Obama’s upcoming meeting with the Dalai Lama.
-Agencies