Financial leaders from Asia's biggest economies voiced concern yesterday about global trade imbalances, but China said it could not move too fast on the yuan and that developed nations must do more to fix the problem.
Top policymakers gathered for the annual meeting of the Asian Development Bank in Hyderabad, southern India, where Chinese Vice Finance Minister Li Yong (
"I believe we should share the responsibility. We are all on the same boat and no one can escape if this boat sinks," he said.
PHOTO: AFP
"Major developed countries should take more responsibility. We need consultations rather than trade protectionism, and we should not politicize trade imbalances," he said.
But Li said more investment in pension and other social security programs will spur consumption and "gradually" eliminate imbalances in China's international balance of payment.
China has been accused by US lawmakers and Treasury Secretary John Snow of keeping the yuan artificially weak, contributing to a US$201.6 billion trade deficit with the Asian nation last year.
China's trade surplus widened to US$11.2 billion in March, its second-highest monthly surplus on record, a government report showed on April 11.
Moving too fast to increase the value of the yuan would "have implications for our exports, imports, agriculture, industry and everything," Li said.
China, under pressure from the US, last July loosened its currency's decade-old peg to the US dollar and revalued it by 2.1 percent.
Since then, the yuan has appreciated 1.23 percent against the US dollar.
The US dollar has declined since the Group of Seven on April 21 called on emerging Asian countries, particularly China, to allow their currencies to rise.
The US currency has fallen 2.2 percent versus the Japanese yen since then, 0.9 percent against the South Korean won and 0.07 percent against the yuan.
Japan added that focusing too much on currencies as a means of addressing trade imbalances would risk fueling market speculation, which ultimately could damage the world economy.
Many economists say that the US simply consumes too much and that its growing current account and fiscal deficits are unsustainable.
The US said it was on a path to cut its budget deficit as a percentage of GDP.
"We have said it frequently, and I say this again today, it is too large and we need to bring it down," said Timothy Adams, the US Treasury undersecretary for international affairs.
"But we need to put it in perspective. Last year, it was 2.6 percent of GDP, we are still on a trajectory to bring it down to 1.5 percent of GDP by 2009," Adams said.
The rising sense of alarm over trade imbalances -- which has helped push the US dollar down this year -- comes amid signs that the IMF is set to take on a role in monitoring exchange rates.
At a Group of Seven meeting of rich nations last month, top financial officials gave their support for adapting the IMF's remit to include "multilateral surveillance."
China, Japan and South Korea, in a joint statement yesterday, called for more voting rights and representation at the IMF to reflect their economic power.
Beijing’s continued provocations in the Taiwan Strait reveal its intention to unilaterally change the “status quo” in the area, the US Department of State said on Saturday, calling for a peaceful resolution to cross-strait issues. The Coast Guard Administration (CGA) reported that four China Coast Guard patrol vessels entered restricted and prohibited waters near Kinmen County on Friday and again on Saturday. A State Department spokesperson said that Washington was aware of the incidents, and urged all parties to exercise restraint and refrain from unilaterally changing the “status quo.” “Maintaining peace and stability across the Taiwan Strait is in line with our [the
EXTENDED RANGE: Hsiung Sheng missiles, 100 of which might be deployed by the end of the year, could reach Chinese command posts and airport runways, a source said A NT$16.9 billion (US$534.93 million) project to upgrade the military’s missile defense systems would be completed this year, allowing the deployment of at least 100 long-range Hsiung Sheng missiles and providing more deterrence against China, military sources said on Saturday. Hsiung Sheng missiles are an extended-range version of the Hsiung Feng IIE (HF-2E) surface-to-surface cruise missile, and are believed to have a range of up to 1,200km, which would allow them to hit targets well inside China. They went into mass production in 2022, the sources said. The project is part of a special budget for the Ministry of National Defense aimed at
READY TO WORK: Taiwan is eager to cooperate and is hopeful that like-minded states will continue to advocate for its inclusion in regional organizations, Lai said Maintaining the “status quo” in the Taiwan Strait, and peace and stability in the Indo-Pacific region must be a top priority, president-elect William Lai (賴清德) said yesterday after meeting with a delegation of US academics. Leaders of the G7, US President Joe Biden and other international heads of state have voiced concerns about the situation in the Strait, as stability in the region is necessary for a safe, peaceful and prosperous world, Lai said. The vice president, who is to be inaugurated in May, welcomed the delegation and thanked them for their support for Taiwan and issues concerning the Strait. The international community
COOPERATION: Two crewmembers from a Chinese fishing boat that sank off Kinmen were rescued, two were found dead and another two were still missing at press time The Coast Guard Administration (CGA) was yesterday working with Chinese rescuers to find two missing crewmembers from a Chinese fishing boat that sank southwest of Kinmen County yesterday, killing two crew. The joint operation managed to rescue two of the boat’s six crewmembers, but two were already dead when they were pulled from the water, the agency said in a statement. Rescuers are still searching for two others from the Min Long Yu 61222, a boat registered in China’s Fujian Province that capsized and sank 1.03 nautical miles (1.9km) southwest of Dongding Island (東碇), it added. CGA Director-General Chou Mei-wu (周美伍) told a