Just in case anyone was deluded into thinking that China was genuinely interested in restoring balance to global trade, along comes this blunt refusal by a Chinese trade official to consider anything that will slow the growth of Chinese exports:
Speaking at a separate forum in Beijing, Jiang Jianjun, a deputy director with the Ministry of Commerce’s Department of Foreign Trade, cited China’s rising share of global output and its swelling foreign exchange reserves as pressures on the yuan to strengthen.
“However, according to our projections, until there’s a noticeable improvement in exports, the exchange rate will not see a major adjustment,” Jiang said.
He said it would take two or three years for China’s combined exports and imports to regain pre-crisis levels.
Of course, exchange rates have nothing to do with trade imbalances, but that’s irrelevant. Both the U.S. and China think that they do, and China’s refusal to allow any further strengthening of the yuan is proof positive that they have no interest whatsoever in re-balancing trade. Give China credit. They understand how to make trade work to their advantage. It helps their cause that the people across the trade table from them are complete fools.