April 17, 2006    Volume 13, No. 8

Home
Search Back Issues
Acronyms
Guest Editorials
Links
Trading Exchanges
Comments
About Us

Lean Machines Sixteen Case
Studies On Lean
Manufacturing
From Manufacturing &
Technology News

Free e-mail newsletter


China's Reserves Soar: NAM Says The Time Has Come For China To Re-Value Its Currency



BY RICHARD McCORMACK richard@manufacturingnews.com


It has become "imperative" for the Department of Treasury to declare that China is manipulating its currency, says Pat Mears, director of international commercial affairs at the National Association of Manufacturers. Further evidence of China's manipulation is that nation's growing currency reserves. They have risen to $848 billion, and are now the largest in the world, surpassing those of Japan's at $837 billion.

"China's currency reserves are nearing half of China's total gross domestic product," Mears notes. "Rather than tying up that much of its economy in low-interest official holdings -- primarily in U.S. dollars -- China could be using those funds to build internal economic strength. China continues to buy dollars to keep its currency suppressed below market values in order to fuel export-led growth, but it's high time for this to stop. It's distorting global trade flows and distorting China's economy."

China's reserves grew $220 billion in the past 12 months. "Not coincidentally, that was the size of its trade surplus with the United States last year," says Mears.

The Treasury Department is expected to issue its bi-annual assessment on currency manipulation at the end of April. In previous reports, it has used China's trade data instead of import and export figures from the United States government in its analysis of China's currency. It has refused to label China as being a country that manipulates its currency despite demands from an increasingly agitated and frustrated community of U.S. manufacturers and workers.



Provide us with a comment on this article.

We'll notify you as issues and free stories like this one appear on this site. Sign up for a content-rich, e-mail newsletter. (You will NEVER receive spam.)

You and your staff can read every article in the latest issue, plus read all the articles written over the past seven years by becoming a regular reader of Manufacturing & Technology News. The cost of a new subscription is $395 per year.




[Home]
Scan Back Issues | Reports & Analyses | Comments | About Us | How To Order

Copyright © 2006, Publishers and Producers.