A senior US trade official yesterday warned against moves that could be seen as “lashing out” at China over the value of its currency, saying there were other ways to level the economic playing field.
US Under Secretary for International Trade Francisco Sanchez said he understood frustrations were running high in the US over a China currency policy perceived as undermining US exports and jobs.
However, he said the response must be consistent with international trade rules, after the US Senate last week approved a bill to impose punitive taxes on Chinese imports if the yuan is not revalued.
“Some of the frustration that you see from the bill that came out of the Senate is a sense that some of the policies that China puts forward do not foster a level playing field,” Sanchez told reporters in Hong Kong after a visit to Beijing with a delegation of US biotechnology firms.
“I would just say generally that as we seek to create a level playing field, we can’t lash out in frustration to China or anyone else,” he said.
Sanchez, whose job is to promote US exports, said Beijing and Washington already had adequate channels of communication to resolve differences, such as the US-China Joint Commission on Commerce and Trade.
The US, which posted a record US$29 billion trade deficit with China in August, is calling for a faster appreciation of the yuan, which many in Washington believe is being kept artificially low.
China defends its exchange rate regime, saying it is moving to gradually make the yuan more flexible, but this has failed to silence critics in the US who say the Chinese currency is undervalued by about 30 percent.
US Secretary of State Hillary Rodham Clinton said on Friday that the Chinese “continue to try to game the system to their advantage and our disadvantage.”
However, the White House has not supported the Senate bill and Republican majority leaders in the House of Representatives have said it could lead to a damaging trade war, effectively dooming its prospects of becoming law.
Sanchez said the US was eager to expand trade and investment with China despite its lingering concerns over issues such as forced technology transfers, copyright protections and local content requirements.
Addressing Chinese complaints about the US export control list, which restricts the export of items deemed sensitive to national security, he said the administration was working hard to reform its policy.
“Our export control regime is first and foremost in place for national security reasons and probably less than 2 or 3 percent of our trade with China would fall under export controls,” he said.
However, he said the administration was trying to remove “inconsequential” items from the list to make them available for civilian use and sale abroad.
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