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Last Updated: Sunday, 21 September, 2003, 10:47 GMT 11:47 UK
China defends currency policy
A bank worker counts Chinese yuan
US industry wants the yuan's value changed
The deputy head of the Bank of China has resisted calls for the country to float its currency.

Deputy governor Li Ruogu said a stable yuan was "beneficial to the whole world", although he repeated it was China's intention to eventually move to looser exchange rates.

China has come under increasing pressure to adjust the value of the yuan, with many countries arguing that the currency is undervalued - thus giving Chinese exporters an advantage on the world market.

On Saturday, finance minister from the wealthy Group of Seven (G7) nations urged exchange rates to reflect economic strength, although they did not mention China by name.

Job worries

Mr Li made his comments at a side conference to the IMF/World Bank annual meetings in Dubai.

"A stable yuan is not only good for us, it's good for our immediate neighbours and for the whole world," he said.

China has fixed the yuan at about 8.28 to the dollar since 1994, with only limited fluctuations allowed.

The US has led calls for China to adjust or float its currency, with US industry arguing that the low rate is responsible for job losses.

The US National Association of Manufacturers (NAM) has said the yuan is up to 40% undervalued, giving China's exporters an unfair advantage.

China has indicated that the fixed rate will not last for ever, but has so far given no indication as to when it might abandon its current exchange rate policy.

And Mr Li repeated the line on Sunday.

"We're committed to liberalization, but I can't give you a very clear timetable of how long it will take," he said.

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