Time to bash China on its currency, again?
The Global Times complained that the US was using “home advantage” to pressure China on its currency once again, given the APEC summit took place in Hawaii.
But the China Daily just argued that the premise of the American complaint was wrong, under the headline “US woes not yuan-related”.
The article repeated President Hu Jintao’s assertion that Beijing followed a “responsible exchange rate policy” and continued to move towards a goal of a market-based price for its currency. Anyway, even an abrupt appreciation of the renminbi won’t solve the unemployment and trade deficit problems in the US, the newspaper added.
President Obama has served notice that the United States was “fed up” with China’s trade and currency practices, Reuters reported. “Enough’s enough,” Obama said bluntly, warning Hu Jintao that China needed to stop gaming the system. He acknowledged that there had been a “slight improvement” in the value of the yuan but insisted that it was not enough.
The Wall Street Journal wondered whether the numbers supported the American view, noting that China’s current-account surplus fell 43.5% from a year earlier to $57.8 billion in the third quarter. Taken as a percentage of China’s GDP, the trade surplus in the first three quarters fell to 3%, versus 5.1% in the same period last year.
A new trade pact, the Trans-Pacific Partnership, but China’s not invited…
China is yet to receive an invite to join Obama’s free trade block, the Trans-Pacific Partnership (TPP), noted China National Radio. This was significant: if Japan joins the TPP, its members will account for GDP of $22.3 trillion, and become the largest free trade area globally. Chinese media also recognised it would be 26% bigger – in GDP terms – than the EU and was angered at the US proposal. The Global Times thought that America’s ‘chief diplomat’ Hillary Clinton “almost explicitly exposed its anti-Chinese nature”.
Is the TPP the result of US paranoia? Outlook Weekly saw the TPP idea as a reflection of the continued weakness of the US economy, as well as the rise of Asia. But it also warned of designs to “reduce China’s influence” in the region.
The People’s Daily took a different line: China needn’t worry about not being in the TPP because any Asian cooperation without Beijing will lack heft, it claimed. Shen Jiru, a researcher with the Chinese Academy of Social Sciences, agreed. “We do not need to worry about being marginalised by TPP,” he said, adding that within five years China’s imports could reach $8 trillion: strengthening Beijing’s clout.
“Beijing baulks at trade accords” was the front page headline in Hong Kong’s South China Morning Post on Tuesday. The US had made it clear that it would invite only those who played by the rules, with the unspoken but fairly obvious insinuation that China didn’t – and hence wasn’t welcome to join the TPP.
SCMP columnist Tom Holland said China had been left out after “10 years of broken promises” on trade – a fair tactic, he felt, given that “Beijing continues to ride roughshod over both the letter and spirit of its WTO accession agreement.”
The snub even had some recalling George Kennan’s policy of containment – albeit targeting China rather than America’s former superpower enemy, the Soviet Union.
The Washington Post stated: “China is feeling at once isolated, criticised, encircled and increasingly like a target of US moves.”
Other foreign media also wondered if the TPP strategy would prove to be a mistake. Any pact without China would lack critical mass and could also be seen as divisive if regarded as an ‘anyone but China’ club, warned the Financial Times editorial page.
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