Geithner targets China’s policies
Treasury Secretary Timothy Geithner signalled a tougher line toward China’s economic policies, saying in prepared testimony that he is studying a “mix of tools” to persuade China to change how it manages its currency and to treat US businesses more fairly.business Updated: Sep 16, 2010 23:10 IST
Treasury Secretary Timothy Geithner signalled a tougher line toward China’s economic policies, saying in prepared testimony that he is studying a “mix of tools” to persuade China to change how it manages its currency and to treat US businesses more fairly.
Using language more sharply critical of China than has been the norm for the Obama administration, Geithner noted the “substantial challenges” posed for the US by an array of Chinese policies, which he criticised as having a “negative impact... on our economic interests.”
China “encourages outsourcing of production and jobs from the United States. And it makes it more difficult for goods and services produced by American workers to compete with Chinese-made goods and services in China, the United States and third countries,” Geithner said. “We need a more balanced economic relationship. This is imperative for us, but it is important to China as well.”
His comments were prepared for delivery at a hearing on Thursday before the Senate Banking Committee. The text was released in advance. Geithner’s remarks did not detail possible steps being considered.
The United States would potentially have a variety of tools at hand, from complaints with the World Trade Organisation to a more aggressive application of US law or even the crafting of punitive legislation, a step favored by some in Congress.
But the change in tone is significant, highlighting frustration with the resurgence of China’s trade surplus with the United States, as well as the increasing sensitivity of economic issues before the midterm elections.
Trade between the two countries has become a pillar of the world economy, but the steady imbalance — the US trade deficit with China is about $200 billion a year — is considered a problem. In Exclusive Partnership with The Washington Post