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Trump's decision not to label Beijing a currency manipulator beneficial

Xinhua | Updated: 2017-04-14 14:52

BEIJING — US President Donald Trump's decision not to label China a currency manipulator is a wise choice that will be highly beneficial to China-US relations.

The US leader's distancing himself from his previous promise shows that he has an increasingly realistic comprehension of the economic and trade connections between the world's top two economies.

The move also shows that Trump has gained a better understanding of how important it is for both sides and the rest of the international community to ensure the world's most important bilateral ties remain stable and even grow after a meeting between him and his Chinese counterpart, Xi Jinping, last week in the US seaside resort of Mar-a-Lago.

At their first meeting, the two presidents agreed to expand mutually beneficial cooperation, and manage their differences so as to bring about greater progress to the two countries and their peoples.

Among the many areas in which the two leaders reached important consensus, one is to facilitate the healthy development of two-way trade and investment, which has increased rapidly in recent years.

Bilateral trade in goods hit $519.6 billion in 2016, an increase of 207 times compared with the figure in 1979 when the two countries established diplomatic relations.

Trade in services between the two countries exceeded $110 billion last year and two-way investment reached $170 billion.

In 2015, bilateral trade and two-way investment helped create about 2.6 million jobs in the United States and contributed $216 billion to the US economy, equivalent to 1.2 percent of the US gross domestic product, said a report from the US-China Business Council.

Obviously, both countries, especially the United States, have greatly benefited from such a close trade relationship -- they are now each other's largest trading partner.

As China and the United States account for a third of the global economy and bilateral trade accounts for a fifth of global trade, the steady and healthy development of China-US trade ties is significant for the stability of the world economy, which is struggling to recover.

Against such a backdrop, slapping a currency manipulator tag on China could be counter-productive as it would not only harm the strategic mutual trust between the two countries but also harm bilateral trade relations -- the ballast of bilateral ties -- and increase the volatility of global markets.

What's more, China itself never manipulates its currency nor does it meet the three standards established by the US government to be officially cast as a currency manipulator.

As to the massive trade deficits with China, they are the result of the evolution of the global distribution of industries and global value chains. China, as a main manufacturer of staple commodities, especially consumer goods, has advantages in labor-intensive industries compared with the United States.

Therefore, starting from the Mar-a-Lago meeting that has charted the course for China-US ties, the two sides need to iron out differences with both political wisdom and dexterity to move their relationship forward.

As Trump has become increasingly aware of the gravity of a sound China-US relationship, it is hoped that the United States will continue to work with China to eliminate factors and issues that stand in the way of bilateral ties to further promote their relationship.

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