Apr 20, 2010
US will act if yuan not revalued
<!-- by line --> <!-- end by line --> WASHINGTON - THE United States will take action if China does not begin to take steps in the coming months to raise the value of its currency, a top lawmaker in the US House of Representatives warned on Monday. Ways and Means Committee Chairman Sander Levin said he expected President Barack Obama's administration to use a pair of international meetings in June to put multilateral pressure on China to revalue its currency 'If it doesn't work, the US will act. I have no doubt about it. I think the administration will act and I think the Congress will act,' the Michigan Democrat said in remarks at the National Press Club.
Mr Levin, whose committee has jurisdiction over trade legislation, said he believed China's currency was 'clearly undervalued,' and has been used by Beijing as 'a major tool for them to get an advantage economically over us.' But Mr Levin also said he was willing to give President Obama and US Treasury Secretary Timothy Geithner at least until the Group of 20 summit meeting in Canada at the end of June to see whether multilateral pressure can persuade China to revalue its currency by a significant amount. 'I think ... by the end of the G-20 meetings, China will make the decision 'we'll begin to do this,' or else we'll take further steps,' Mr Levin said.
That schedule gives Beijing slightly more time to act than a late May deadline set by US Senate leaders. Many economists believe China's currency is undervalued by as much as 40 per cent, giving it an unfair advantage in world trade by effectively subsidizing its exports while putting a de facto tax on imports. President Barack Obama said he raised the issue of China's 'undervalued' currency with Chinese President Hu Jintao last week and would continue to press the point. China says its currency exchange rate is an internal matter and it will not be prodded into revaluing before it is ready. -- REUTERS
