The United States named Germany, China and three other East Asian countries on Friday to a new "monitoring" list of trade partners with excessive budget and trade surpluses.
The US Treasury said that five countries on the new list each met two
of three criteria for assessing unfair play in international trade.
(Photo: AFP/Andrew Caballero-Reynolds)
WASHINGTON: The United States named Germany, China and three
other East Asian countries on Friday (Apr 29) to a new "monitoring"
list of trade partners with excessive budget and trade surpluses.
Taiwan, South Korea and Japan were also on new watchlist of
the US Treasury that points out countries that Washington suspects are
behaving unfairly to support their economies.
The new assessment replaces the previous biannual "currency
manipulator" review mandated by Congress that threatened to punish
anyone found guilty of artificially holding their currencies down to
boost their exports.
The Treasury said that the five on the new list each met two of three
criteria for assessing unfair play in international trade. None however
met all three of the criteria, which could lead to retaliation by US
authorities:-- Maintaining a significant trade surplus with the United States
-- Maintaining a current account surplus larger than 3.0 percent of the country's GDP
-- Repeated intervention in the foreign exchange market to keep its currency from appreciating.
China, Japan, Germany and South Korea were seen as guilty of the first two criteria but not the third. Taiwan was listed for its large current account surplus and persistent purchases of foreign exchange last year, keeping the New Taiwan dollar low against the US dollar.
China has been on the Treasury's watchlist for years for allegedly holding its currency down to gain trade advantage.
But the new report said that Beijing, since its surprise
devaluation last August, has intervened heavily in foreign exchange
markets in recent months to support its yuan currency, rather than push
it down.
If further depreciation of the yuan had followed, the
Treasury said, it "would have had negative consequences for the Chinese
and global economies."
As for Germany, which is a member of the eurozone and so not
fully able to manipulate the euro shared currency, the Treasury said
the country's big trade surplus with the United States and its large
budget surplus "represents substantial excess saving."
That surplus, it said, could be used to support German
demand, in turn "reducing the current account surplus and contributing
markedly to the euro-area and global rebalancing."
- AFP/ec
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