Treasury Secretary Postpones Report On Currency Policies
James A. Morrissey
U.S. Treasury Secretary Timothy F. Geithner has decided to delay issuing a report on international
currency policies in a move that will avert a showdown on China's alleged currency manipulation
before Chinese President Hu Jintao's visit to Washington later this month. The report was scheduled
to be released April 15.
Geithner said he had decided to postpone release of the report in view of "a series of very important high-level meetings over the next three months that will be critical to bringing about policies that will help create a stronger, more sustainable and more balanced global economy."
He cited, for example, an upcoming meeting of the G-20 developed countries' finance ministers and central bank governors later this month, and a Strategic Economic Dialogue with China in May. While stating that these meetings are the "best avenues for advancing U.S. interests at this time," Geithner did say China's inflexible currency policies remain a concern.
China has pegged its currency, the yuan or renminbi, to the dollar at a rate that is considered to be undervalued by as much as 40 percent, and that gives China an unfair --some say illegal -- advantage in international trade.
Sen. Charles E. Schumer, D-N.Y., who is co-sponsoring legislation to address the Chinese currency problem, said he was "disappointed but not surprised" by Geithner's decision and said he will push ahead with legislation. Going the legislative route has been opposed by both the Bush and Obama administrations, which have said they believe negotiations at bilateral and multi-levels are the best route to take.
The U.S, Business and Industry Council (USBIC) reacted strongly to Geithner's decision, saying a delay in labeling China a currency manipulator "can only guarantee more American factory cutbacks and closures with accompanying job losses." USBIC President Kevin Kearns said, "Once again the Obama administration is forcing our domestic producers to pay the price of U.S. diplomacy repeating an ineffective Washington tradition of buying foreign cooperation with U.S. market share."
April 6, 2010