Beijing promises yuan appreciation, "at a measured pace"
Beijing (AsiaNews/Agencies) - The question of energy has dominated the first day of the fourth strategic economic dialogue between China and the United States, the largest worldwide consumers, who want to guarantee adequate supplies for themselves. Meanwhile, Beijing announces the intention to revalue the yuan with respect to the increasingly weak dollar.
In Annapolis (Maryland), Zhou Xiao Chuan, governor of China's central bank, told journalists yesterday that the yuan "must be revalued" because of the weakness of the dollar, which will cause a rise in the prices of raw materials. The dollar has lost about 30% of its value since 2002, while the yuan has appreciated by 20% against the dollar since July of 2005. For some time, Beijing has been criticising the United States and asking for the country to intervene to stabilise the dollar, observing that - as Sun Zhenyu, Chinese ambassador to the World Trade Organization, repeated last week - "as a major currency for international reserve, the dramatic depreciation of the dollar has lead to shrinking national reserves for many countries and reduced social welfare".
Zhou said that emerging economies are "feeling the pinch" from the decline of the dollar. Many experts maintain that an appreciation of the yuan is also necessary to combat increasing domestic inflation, while the United States observes that the low exchange rate fosters Chinese exports and the increase of the trade deficit in Beijing's favour.
Beyond the statement, the results of the talks appear to be modest. U.S. treasury secretary Henry Paulson, emphasising that energy demand is increasing while production has remained stable for years, insisted that the two countries can work together for energy security and environmentally sustainable production. Chinese deputy prime minister Wang Qishan has confirmed that Beijing is considering how to revalue the yuan, but will do so at a measured pace.
The two countries are separated on other positions: for example, Beijing does not appear willing to open its financial market to foreign companies, as Washington is asking. The promise that the revaluing of the yuan will continue appears to be aimed in part at softening these disagreements.
In any case, Beijing is seeking its own model of economic development, one different from that of the United States, and analysts do not expect great results from these talks, partly in view of the fact that George W. Bush's presidency is about to end.
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