Call echoes previous moves to pressure China to stop what they see as currency “manipulation”.
|Senate has pushed a bill that will allow the US to impose duties on countries that undervalue their currencies [EPA]|
China’s foreign ministry has said it “firmly opposes” a bill pushed by the US Senate that will allow the country to impose duties on countries that undervalue their currencies.
In a statement posted on China’s official government website on Tuesday, the ministry said the US was “using the excuse of ‘currency imbalances'” to adopt protectionist trade measures that violated World Trade Organisation rules.
“The Chinese side appeals to the US side to abandon protectionism and not to politicise trade and economic issues, so as to create a favourable environment for the development of China-US economic and trade ties,” Ma Zhaoxu, the Chinese foreign ministry spokesman, said.
The Senate voted on Monday to advance legislation designed to press China to let its currency, yuan, rise in value.
The move has set up a debate between lawmakers who say the bill will create jobs and critics who warn it could spark a trade war.
More than 60 senators voted to allow debate on the bipartisan Currency Exchange Rate Oversight Reform Act of 2011.
The bill has bipartisan backing, but still the legislation faces considerable hurdles before it becomes law.
The Obama White House, while agreeing that China’s yuan is undervalued, has been wary of unilateral sanctions against the Beijing government.
Major US business groups share those misgivings and House Republican leaders have shown no interest in bringing it to a vote.
The Senate bill, which does not specifically mention China, sets in motion a process for imposing punitive tariffs against a country with misaligned currencies.
The bill also makes it easier for specific industries to seek higher tariffs on foreign competitors when undervalued currencies become a means to subsidise exports.
Supporters of the bill say that, despite some incremental adjustments by Beijing over the past year, the value of the yuan is still as much as 40 per cent below what it should be. They say that is a major factor in a trade deficit with China that hit $273bn last year.