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Friday, 12 March 2010

Obama issues new call on China over yuan

OBAMA FOR USA

US President Barack Obama on Thursday issued a fresh call to China to embrace a "market oriented" exchange rate for the yuan, saying such a move would help rebalance the global economy.

Obama made his latest foray into the delicate US-China relationship in a major speech on trade, saying the world needed to rebalance the mix of exports and imports driving growth in the aftermath of the financial crisis.

"Countries with external surpluses need to boost consumption and domestic demand," Obama said in a speech to the Export-Import Bank in Washington.

"And as I've said before, China moving to a more market-oriented exchange rate will make an essential contribution to that global rebalancing effort."

Obama's comments on the yuan represented the latest sign of discord between Beijing and Washington following a series of recent spats over the economy, Tibet, Taiwan and diplomacy.

China last month mounted its latest defense of the value of the yuan, rejecting accusations that its currency policy was responsible for global trade imbalances..



The commerce ministry said maintaining a stable currency was a "top priority" and was necessary for the survival of Chinese companies and supporting jobs growth in the world's third-largest economy.

Washington wants China to allow the yuan's value to appreciate, to make US exports more competitive.

Obama also referred to the stalled Doha round of trade talks and US bilateral free trade deals with partners in South Korea, Panama and Colombia, but did not give a timetable for their implementation.

"We'll continue to work towards an ambitious and balanced Doha agreement -- not just for the sake of any agreement, but for one that enhances market access for American agriculture, goods, and services," he said.

"We'll strengthen relations with key partners like South Korea, Panama, and Colombia, with the goal of moving forward with existing agreements in a way that upholds our values."

Obama was treading a careful line on trade, between business lobbyists who want to push trade deals and Americans feeling the lash of the economic crisis who see such pacts as tantamount to sending US jobs overseas.

The president also used Thursday's speech to unveil an ambitious strategy to double American exports to ease an unemployment crisis at home.

The National Export Initiative will create an export promotion cabinet and other federal agencies linked to exports, which Obama wants doubled in five years to support two million new jobs in America battling nearly double-digit unemployment.

Obama will also re-establish a presidential export council -- a principal private-sector advisory committee on international trade -- and name two prominent American business leaders to lead the council, officials said.

They are aerospace giant Boeing president and chief executive Jim McNerney and Xerox CEO Ursula Burns.

The export strategy will strive to improve access to financing for businesses that want to increase exports, enforce existing trade deals and "level the playing field" for American businesses and workers.(AFP)
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