China accuses US of suggesting trade war

Nov 15 | Updated: Nov 16 2005, 05:30am hrs
Chinese trade minister Bo Xilai said attempts by US lawmakers to impose tariffs on goods produced in Asias second-largest economy may spur a bilateral dispute and would violate global commerce accords.

A congressionally appointed panel on Nov. 9 called Chinas revaluation of its yuan currency an extremely limited step and said Congress should consider tariffs against Chinese imports. It urged lawmakers to file a complaint before the World Trade Organisation unless China revalues the yuan by at least a quarter.

This shows an attitude of wanting a trade war, which, if escalated, will not benefit either side, Bo said in an interview in Busan, South Korea. No one is forcing the US to buy Chinese goods. US lawmakers, manufacturers and unions have been pressing US President George W Bush to crack down on what they say are Chinas unfair trade practices, such as undervaluing its currency, providing cheap loans to companies and cutting taxes for domestic producers.

Chinas trade surplus swelled to a record $12 billion in October from $7.56 in September, the Beijing-based customs bureau said in a Nov. 10 statement. Exports rose 29.7% from a year earlier, outpacing a 23.4% gain in imports.

WHAT CHINA SAYS
Attempts by US to impose tariffs would violate global commerce accords
US attitude would invite trade war, which, if escalated, will not benefit either side
Bush plans to meet Chinese President Hu Jintao in Beijing on Nov. 19 as part of trip for the Asia-Pacific Economic Cooperation summit in Busan. China on July 21 reset the yuans value at 8.11 to the dollar, a 2.1% appreciation from the pegged level where it had been held since 1995, and started managing its value against a basket of currencies including the euro and yen. It has gained 0.33% since the revaluation.

-Bloomberg