Sat, Nov 17, 2007 - Page 12 News List

PRC manipulating currency: US report

AFP , WASHINGTON

A US Congress-appointed commission on Thursday accused China of manipulating its currency and called for legislation imposing penalty tariffs on Chinese goods flooding the US market.

The US-China Economic and Security Review Commission, in a report to Congress on Thursday, proposed that "Congress enact legislation to define currency manipulation as an illegal export subsidy and allow the subsidy to be taken into account when determining penalty tariffs.

"In addition, Congress should amend the law to allow currency manipulation to be added to other prohibited subsidies when calculating antidumping and countervailing duty penalties," it said.

The US Senate is already considering bills that would allow Washington to push nations to adopt more market-based currency policies or face sanctions.

The US Treasury had in the past stopped short of branding China a "currency manipulator," a designation that could lead to economic sanctions.

"While speaking of subsidies and violations of free market principles, it is worth noting here that China is continuing to manipulate the value of its currency in order to gain an unfair export advantage," commission Chairwoman Carolyn Bartholomew said.

"The artificially low value of the renminbi [yuan] provides a subsidy for Chinese exporters and serves as a hindrance to Chinese importers and consumers," the report said.

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