US lawmakers criticised US President Barack Obama’s administration for not pressuring China enough over its rigid currency as they set the stage for slapping import duties on Chinese goods.
As Obama returned home without any pledge from China to make its yuan flexible, Republican and Democratic lawmakers sent a letter to the commerce department calling for an investigation into “China’s currency manipulation.”
It is “a potential first step in a process that could lead to significant, US-imposed tariffs on imports from China,” said Democratic Senator Charles Schumer, who jointly wrote the letter with Republican Senator Lindsey Graham.
The Obama administration, like the Bush administration before it, has refused to brand China a currency manipulator under a law requiring it to determine whether any foreign economy manipulates its currency against the US dollar.
“If the agency determines that China’s currency practices amount to a form of subsidy that is actionable under international trade agreements, the Chinese could be subject to stiff penalties,” Schumer said.
Lawmakers and several industry groups claim Beijing was artificially weakening the yuan value to boost its export competitiveness, a factor they blamed on the record $268 billion trade deficit with China last year.