Taiwan remains on USA currency monitoring list
- Author: Larry Hoffman Apr 15, 2017,
Apr 15, 2017, 21:39
In a semiannual report on America's major trading partners published late Friday, the Treasury Department declined to label any country a currency manipulator, though it kept China, Japan, Korea, Taiwan, Germany and Switzerland on a previously established "watchlist" of countries that merit close attention for their currency practices.
On the other hand, it hurts American exports and directly threatens Trump's campaign pledge to correct the USA trade deficit, particularly in the manufacturing sector, which has withered from Chinese and Mexican competition.
In fact, in recent years the Chinese government has intervened to prop up the currency, economists say.
Trump heaped criticism on China during his campaign saying they deliberately undervalued their currency, the yuan, to gain an advantage in global trade and create a wide trade deficit with the United States.
The decision was expected after President Donald Trump this week reversed himself and said China was not a currency manipulator. In 2015, the gap between what it imports from China and what the United States exports to the country reached a gargantuan $334bn (£267bn). The countries - China, Japan, Germany, South Korea, Taiwan and Switzerland - were the same six named in the last currency report issued by the Obama administration in October. Trump is seeking China's help in dealing with an increasingly belligerent and risky North Korean regime.
From China to Syria, trade to the dollar, a rapid succession of 180 degree reversals has left Washington, foreign capitals and Trump's own fans with a nasty case of political whiplash.
The Treasury said it "will be scrutinizing China's trade and currency policies very closely".
Trump's evolving views on those two world powers have brought the US back into alignment with former President Barack Obama's pattern of "great power" politics.
The reversal on branding China a currency manipulator is among several changes in which Trump has softened tough stances he had taken during the campaign. China's $347 billion goods trade surplus with the US was the largest of major trading partners previous year, according to the report. The administration has also put forward a draft proposal on renegotiating the North American Free Trade Agreement with Mexico and Canada that dropped some of the tougher positions Trump took during the campaign.
Dan DiMicco, the former boss of Nucor steel, said the president's efforts on trade and China were "all talk and no action". "When the President fails to label them a currency manipulator, he gives them a green light to steal our jobs and wealth time and time again", Schumer said.
A strong dollar policy is strictly defended by USA since mid-1990s, saying for a robust, attractive economy, dollar stood strong.
The promise of restoring American jobs by cutting off what it considers unfair trading practices has been a signature promise of the Trump administration.
But Trump told the Journal that he'd learned that the Export-Import Bank serves small businesses and helps US firms compete with foreign companies that receive help from their governments.
Now, China needed to show that its lack of intervention in the currency markets "to resist appreciation" over the past three years was a "durable" policy by allowing the yuan to strengthen "once appreciation pressures resume", the Treasury said.
After talks and a slice of chocolate cake at Mar-a-Lago, China's Xi Jinping was no longer responsible for the "rape" of the United States economy.