[an error occurred while processing this directive]
BBC News
watch One-Minute World News
Last Updated: Wednesday, 20 June 2007, 10:28 GMT 11:28 UK
China calls for currency fairness
Chinese shopper
Beijing says currency reform is not the key to trade imbalances
China has called into question international efforts to tackle currency manipulation by saying poorer countries must be treated fairly.

It spoke out after the International Monetary Fund (IMF) disclosed plans to focus on foreign exchange strategies threatening global financial stability.

Experts interpreted the move as a response to US concerns that China has kept its currency artificially low.

China's central bank said the new approach must be "even-handed".


The US government has been pressing its Chinese counterpart to allow the yuan to trade more freely, arguing that its value against the dollar unfairly benefits Chinese exporters.

Many US politicians have demanded action on the issue, saying the yuan's value has fuelled the huge US trade deficit and is distorting global capital flows.

It does not fully reflect the developing countries' opinions
Chinese central bank

But Beijing has reacted coolly to the new measures - the first changes in the IMF's oversight policy in 30 years - questioning how appropriate they are for developing countries.

It said the IMF should take into account China's recent efforts to make the yuan more flexible and attempts to reform its own economy.

In a statement, China's central bank said adjusting exchange rates was not the "ultimate and only instrument" for tackling trade imbalances.

"China has expressed reservations about the adoption of this decision as it does not fully reflect the developing countries' opinions," it said.

"Large and disorderly exchange rate adjustments will not only exacerbate external instability, but also affect the sustainability of a country's domestic economic growth."

US Treasury Secretary Henry Paulson is set to be questioned on the issue when he appears before Congressional leaders on Wednesday.

IMF steps up exchange rate rules
19 Jun 07 |  Business
US rejects China currency charge
13 Jun 07 |  Business
Economy risks lower says IMF boss
09 Apr 07 |  Business

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Americas Africa Europe Middle East South Asia Asia Pacific