Financial Regulatory Forum

INTERVIEW – Obama says will raise currency with China

By Reuters Staff
November 9, 2009

U.S. President Barack Obama answers questions during an interview with Reuters in the Oval Office at the White House in Washington, November 9, 2009.   REUTERS/Jim Young   (UNITED STATES POLITICS) By Caren Bohan and Alister Bull
WASHINGTON, Nov 9 (Reuters) – U.S. President Barack Obama said on Monday he plans to raise the issue of the yuan currency with Chinese officials when he meets with them in Beijing next week.

“Currency, along with a host of other issues, will come up, and I’m confident that both the United States and China can arrive at a broad set of policies that encourages trade that benefits both countries, that allows ongoing economic growth,” Obama told Reuters in an interview.

U.S. manufactures complain that Beijing artificially holds the value of the yuan down to make its exports cheaper, and American goods more expensive for Chinese consumers.

Economists say this has led to imbalances in the world economy by contributing to big trade deficits in the United States and trade surpluses in China. G20 leaders pledged at a summit in Pittsburgh in September to aim for policies to ease these imabalances.

Obama has so far resisted domestic pressure to brand China as a currency manipulator, which could anger a crucial U.S. creditor. Instead, Obama said that the two countries share a common interest in delivering sustainable growth that will help rebalance the global economy.

“They have a huge amount of U.S. dollars that they are holding, so our success is important to them. The flip-side of that is that if we don’t solve some of these problems, then I think both economically and politically it will put enormous strains on the relationship,” he
said.

But Obama did acknowledge that the complaints about access to Chinese markets had some validity.

“Our manufacturers, I think, would have legitimate concerns about our ability to sell into China,” he said, and emphasized that boosting U.S. sales oversees was a crucial part of his economic agenda.

“It is particularly important for us when it comes to Asia as a whole to recognize that in the absence of a more robust export strategy it is going to be hard for us to rebuild our manufacturing base and employment base in this country.

(Editing by Frances Kerry)
((caren.bohan@thomsonreuters.com, +1 202-898-8392; Reuters Messaging: caren.bohan.reuters.com@reuters.net))
Keywords: OBAMA/CHINA

Monday, 09 November 2009 17:21:48RTRS [nN09278455] {C}ENDS

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
  •