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.
ECONOMIC RESILIENCE: Only 11.4 percent of Taiwan’s overseas investments last year were in China, and businesses are dispersing their investments elsewhere, Lai said China’s ambition to annex Taiwan is based on a desire to change the rules-based international order, rather than a desire for territorial gains, President William Lai (賴清德) said in an interview. During an appearance on the talk show The View With Catherine Chang, aired last night, Lai said China aimed to achieve hegemony, and that peace and stability in the Taiwan Strait was an issue of worldwide concern. During the interview, Lai also discussed his “four-pillar plan” for peace and prosperity, which he first outlined in an article published by the Wall Street Journal on July 4 last year. That
‘REGRETTABLE’: TPP lawmaker Vivian Huang said that ‘we will continue to support Chairman Ko and defend his innocence’ as he was transferred to a detention facility The Taipei District Court yesterday ruled that Taiwan People’s Party (TPP) Chairman Ko Wen-je (柯文哲) be detained and held incommunicado over alleged corruption dating to his time as mayor of Taipei. The ruling reversed a decision by the court on Monday morning that Ko be released without bail. After prosecutors on Wednesday appealed the Monday decision, the High Court said that Ko had potentially been “actively involved” in the alleged corruption and ordered the district court to hold a second detention hearing. Ko did not speak to reporters upon his arrival at the district court at about 9:10am yesterday to attend a procedural
Thirty Taiwanese firms, led by Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and ASE Technology Holding Co (日月光投控), yesterday launched a silicon photonics industry alliance, aiming to accelerate the medium’s development and address the energy efficiency of artificial intelligence (AI) devices like data centers. As the world is ushering in a new AI era with tremendous demand for computing power and algorithms, energy consumption is emerging as a critical issue, TSMC vice president of integrated interconnect and packaging business C.K. Hsu (徐國晉) told a media briefing in Taipei. To solve this issue, it is essential to introduce silicon photonics and copackaged optics (CPO)
The High Court yesterday overturned a Taipei District Court decision to release Taiwan People’s Party Chairman Ko Wen-je (柯文哲) and sent the case back to the lower court. The Taipei District Prosecutors’ Office on Saturday questioned Ko amid a probe into alleged corruption involving the Core Pacific City development project during his time as Taipei mayor. Core Pacific City, also known as Living Mall (京華城購物中心), was a shopping mall in Taipei’s Songshan District (松山) that has since been demolished. On Monday, the Taipei District Court granted a second motion by Ko’s attorney to release him without bail, a decision the prosecutors’ office appealed
RSS