Friday, September 3, 2010

China Slams Allegations of Exchange Rate Subsidies


China dismissed allegations by US producers over its exchange rate as “groundless” on Wednesday, as Washington said there was no evidence that the undervalued yuan constituted a state subsidy.

The US Commerce Department said Tuesday it found insufficient evidence to probe allegations that China’s undervalued currency is the equivalent of a state subsidy to its manufacturers. The allegations were made by US producers angry about imports of aluminum products and coated paper from China.

“We noted the ruling made by the US Commerce Department... according to the related agreements of the World Trade Organisation, foreign exchange issues do not constitute subsidies,” China’s Commerce Ministry said. “We hope the US side will continue to follow WTO rules on cases of trade remedy and carry out (trade) probes in a prudent way,” it said in a statement, adding that specific allegations against the Chinese products were “groundless.” Read more here.