China's currency policy not to blame: German minister

Updated: 2011-10-05 15:01


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CHICAGO - The current financial crisis in the West could not be blamed on China's currency policy, said a senior German official here Tuesday.

Werner Hoyer, minister of state at the German federal foreign office, said China is currently in an advantageous position regarding the global debt situation, and for the West it might be better to concentrate on rethinking its own economic policies rather than focusing so much on the Chinese currency issue.

"I'm not very happy with the currency policies of the People's Republic of China, but on the other hand I think we should not hide behind this allegation when it comes to our own structural weakness," Hoyer said, speaking at a talk for the Chicago Council on Global Affairs.

"Let's be honest, why can [China] be so strong in their positioning?"  he asked.

"They are the largest and most important holders of foreign currency around the world. So let's be realistic of this, and as I said I'm not happy about their currency policies and I'm convinced that it will gradually change - it should change quicker, mind you, but this is not the only reason behind our problems."

On long-term solutions to the developed world's lagging economic growth, one of the issues Hoyer felt countries like Germany and the United States should concentrate most upon is embracing not just financial reform but also a sense of competition.

"What must be expected from each and every country in the European Union and probably also from each and every state and school district in the United States is to take education and innovation as the number one priority," he said.

In addressing issues such as these, the West will produce a stronger foundation for staying competitive in an increasingly globalized world, he added.

Hoyer's words came at a time when the United States Senate is debating the passage of a controversial bill that would officially investigate the alleged artificial currency manipulation by China and impose tariffs on its imports.