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FM rebuts US threat of economic sanctions
By Qin Jize and Zhang Dingmin (China Daily)
Updated: 2005-04-08 06:39

China delivered a sharp rebuke yesterday to the US Senate's threat to impose economic sanctions if Beijing fails to change its current currency policy.

Foreign Ministry spokesman Qin Gang said in Beijing the latest analysis by the International Monetary Fund showed that China's currency does not appear undervalued.

Foreign Ministry spokesman Qin Gang takes a question at a regular press briefing in Beijing April 7, 2005. [newsphoto]
"When determining whether the currency is or is not undervalued you do not only take into consideration bilateral trade but multilateral trade as well," Qin told the regular briefing.

"China has trade surpluses with the United States yet the country is experiencing a big trade deficit with many of its Asian trading partners," he said, adding that the United States should adjust its economic imbalance by looking at its own reasons.

China saw faster import increases last year while trade was basically balanced and tremendous reform work was done to improve the renminbi exchange rate mecha-nism.

He said China is willing to settle any trade disputes with the United States through equal negotiations so as to push forward the healthy and stable development of the bilateral trade.

A considerable part of Chinese exports are produced by China-based factories funded by overseas companies, including US firms.

"Most of the profits go to foreign investors and the Chinese side typically takes a small part, although the production is based on consumption of Chinese resources and energy," said Wang Yuanhong, a senior analyst with the State Information Centre.

Meanwhile, Qin said China supports reforms of the UN Security Council, but said priority should be given to increasing representation of developing countries.

Qin said the reform of the UN is of great importance and should help build solidarity among member countries.

He said the consensus-seeking process should be characterized by wide and patient discussions by every country.

He said such discussions are the foundation of the UN and should be a priority when dealing with important issues.

He said to force the development of immature proposals would hurt the solidarity and authority of the UN Security Council.

Chinese Ambassador to the United Nations Wang Guangya said on Wednesday China supports reforms of the Security Council, but "is not in favour of setting an artificial time limit for Council reform and still less of forcing through any immature proposals lacking consensus in the form of a vote."

UN Secretary General Kofi Annan delivered a report to the UN General Assembly on March 21, calling for a decision by the General Assembly on the expansion of the 15-nation Security Council before world leaders gather in New York in September for a UN summit.

The UN chief also expressed veiled support for a vote by the assembly if no consensus could be reached after "healthy discussions."

(China Daily 04/08/2005 page2)

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